Andrew: Coming up, how you get an investor to give you back a piece of your business. Check out what today’s guest did. Also, I know some of you have been urging me to keep being a bulldog and look for details that you can use. Well, I did a little bit of that in this interview. I’m looking at my notes right now, and I see five solid tactics on growth that I got out of this interview because I pushed a little beyond my comfort zone. Also, if I say the word ‘systemized’, you are probably going to want to roll your eyes and check out of this interview. Watch how systemizing and specifically, I hate to use this phrase too, but creating a manual helped this entrepreneur grow his business and grow it again, and really enable it to grow beyond him.
All right. All that and so much more coming up.
Listen up. I hate to have commercials interrupt this interview, so I’m going to tell you about three sponsors quickly now. Then, we’re going to go right into the program. Starting with Walker Corporate Law. If you need a lawyer who understands the start-up world and the tech community, I want you to go to WalkerCorporateLaw.com.
Next, I want to tell you about Shopify. When your friend asks you, ‘How can I sell something online?,’ I want you to send them to Shopify and explain to them that Shopify stores are easy to set up. They increase sales, and they’ll make your friend’s products look great. Shopify.
Finally, I want to tell you about Grasshopper. Do you want a phone number that people can call, then press 1 for sales, 2 for tech support, etc., and have all of the calls be routed to the right person’s cell phone? Well, get your number from Grasshopper.com.
All right. Let’s get started. Hey there, freedom fighters. My name is Andrew Warner. I am the founder of Mixergy.com, home of the ambitious up start. I’ve got a returning guest here with me. It seems like what we’re going to be doing with Brian, who you’re about to meet, is maybe following him as he builds up his business. Brian Kaldenberg is the founder of Proofreading Pal, which provides an array of proofreading services to businesses, individuals, and students. Last time he was on here was January 2011, when he talked about how he generated $8000 in monthly revenue. I told him at the time that, and I told you guys at the time, that this wasn’t the typical interview. I usually like to wait until people build their businesses bigger. There was something interesting about the way that he was building his company. Something intrigued me about how open he was, and I had to have him on. I’m glad that I did. The interview was enlightening, and it was one of the more popular interviews that I’ve had up on the site. I’ve invited him back to see where he is with the business and to find out how he got here. Brian, welcome back.
Brian: Hey, Andrew. Thanks for having me. We’re doing well. We cracked $60,000 in gross sales in November 2012. We reached profitability back in April of 2012. 2012 as a whole was a profitable year. Now, we’re poised to hit up the busy Spring semester. We’ll get a lot of academic work. I’m estimating close to $70,000 in gross here in March and hoping. . . It is a little ambitious, but hoping to reach close to 90 in April.
Andrew: OK. I want to know about where you were, not so much about where you’re going, because you can never predict with this stuff where things go. I understand that you’re going to build it up. That’s why I want to keep having you back on here. Highest month you said was November. $60,000 is what you cracked. Last month, which was February, what size revenues were you doing then?
Brian: 45.
Andrew: 45,000. The dip is because?
Brian: The dip is because a large portion of our customer base is still academic. There’s just not as many papers, theses, dissertations, midterm essays, end of year essays being written at that time. It’s always November, April. That’s what we’ve found, three years into the business.
Andrew: You told Jeremy, who pre-interviewed you, that you were going through, and I didn’t know this at the time when you and I talked, you were going through a big period where you were just overwhelmed. Yes, you were doing well. $8000 in revenue for a young company is very impressive, and the growth trajectory was impressive and promising. You were also doing so much that you were overwhelmed. What kinds of things were you doing?
Brian: Everything. It was coming in. I had to be here everyday, on the dot, 8:00 am to put out fires. I was doing the courtesy call follow-ups, making sure that every project we did, every new customer understood how our process worked, making sure they were satisfied. That’s one of the quality control processes we have on our outsourced proofreaders, recruiting, attracting, hiring new proofreaders. Our website has changed a lot since our last interview, managing our outsourced web developer through oDesk, and bugs. We deal with bugs all the time. Customer feedback. We’re implementing those sort of things into the website. Then, it’s training. When we did hire in-house people, it’s training them. We’re much more prepared to train new hires now than we were previously, because we have a manual that’s always adapting. If it wasn’t for the book E Myth, I never even thought about a manual. I was always in this mindset of me, me, me, me, and everything is going to be kept in my head, not realizing that you’ve got to get stuff documented if you want to delegate and grow.
Andrew: You know what? Let me spend a little bit of time on this manual because we’ve been developing a manual, and there are good parts to it. There is also a big danger that I haven’t talked about before. Frankly, as people will see, there is a danger even to doing this interview and the interview that you did before. We’ll talk about both of those things in a minute. First, let me understand why you wanted to do a manual, so that people can see what you were building up and how they could do it themselves. What’s the point of building . . . I’m sorry. Let me phrase the question this way. Give me an example of one thing that the manual helps you with.
Brian: A customer calls in, and they accidentally uploaded the wrong document into our system.
Andrew: OK. In the past, before the manual, what would you do?
Brian: I would contact the proofreader, have them stop until we get the right document. If they’ve already started on it a little bit, we might have to compensate them for their work. Then, I would forward them the correct document, then I would go in the system and leave a note, because we need the second proofreader to know that they need to email customer service for the first proofreader’s document when they’re done. Then I would, we’d have to. . . Our system wasn’t set up to change the document in the system, so then we’d have to manually email the file back to the customer. All this was in my head. When we started to bring on more help, this was just one situation, every little thing that came up that wasn’t right, they would have to contact me, email me. If I’m at the office, they have to ask me. If I’m not at the office, they have to call me. The manual is there for their reference to guide them through Proofreading Pal’s policies and procedures for how we want you to handle every situation we’ve handled or encountered previously.
Andrew: OK. When you’re running a business that’s doing $8000 a month in sales, you don’t have so many customers that you can’t do it all yourself. Once you attempt to increase that by 10 times, by even five times, it means that you need a bigger staff, and you need procedures for them to do it so they don’t keep coming back to you. Why did you fight this? This seems to make sense. We’ve heard lots of people say that they have manuals. In fact, every company that you even considered working for, back when you were in school, had a manual that they would give employees on day one. We as entrepreneurs fight it. Why did you fight it?
Brian: Time.
Andrew: Because it takes too much time to do what?
Brian: To write it out and develop it. You get that new call, that situation like, ‘Oh. That’s kind of an interesting situation that I just handles myself, but Stephanie, who’s coming in, in the morning, she wouldn’t know how to handle that. It’s just like, I’ve got so many other things on my plate right now. I don’t have time to sit there and document how I handled this in the manual.’ Really, the reason it doesn’t get developed how it needs to be is because my time was spent on more, what I thought, and maybe at the time they were more important tasks of growing and revenue generation, customer satisfaction. Documenting what I was doing was certainly not at the top of my priority list.
Andrew: Then, what tools do you use to allow yourself to create this manual quickly enough for it not to suck up your time, but also clear enough for someone else to follow?
Brian: Well, when we started hiring employees, I started having them create the manual when they were in their downtime. The basics that I’ve trained you, let’s get that in the manual. Then, I would review it and provide feedback. This manual has grown a lot in the last two years. Stephanie came in last August, and she’s very talented. She just kind of spearheaded the manual. She’s been adding in anything that we wanted added, any of our employees. We send that to Stephanie. She adds it to the manual, and we write it so simple. It’s like, if you were teaching someone how to make a peanut butter and jelly sandwich. It’s literally, open the drawer, grab the knife, open the refrigerator, get out the bread. It’s that simple. Really, it was delegating this manual. The content gets created. I review it to see if it’s exactly how I want it, then they make the changes. It’s always. . . We use Microsoft Track Changes, just like we do with when we’re proofreading documents. I can see all the recent revisions.
Andrew: You just do it in Microsoft Word and put all these Word documents into a folder that everyone in the company has access to?
Brian: It’s just one Word document, and it’s got a table of contents. The next goal is to move it into a Wiki, which is searchable, then also have more video, how-to screen capture video. Right now, we just have screen shots. Yeah. It’s just in a Microsoft Word document on our server.
Andrew: I see. Alright. Here’s the issue with that. Now that someone has one document that says how to run your business, can’t they just take it and go give it to your competition? Can’t someone who’s listening to us right now say, ‘Hey. I’m in the proofreading business. I need somebody to be my go-to person. Hey, Brian’s got a go-to person who knows how to create the document. He even said her name on Mixergy. I’m going to go hire her, and she’ll just bring her document with her. What is it? You just throw it on a USB key, and you have it. She helped create it. She feels a sense of ownership of it.’ Now, you’ve got a competitor who’s going to do everything that you do well and maybe improve on it.
Brian: Well, I finished reading Tony Hsieh. I can’t . . .
Andrew: Tony Hsieh.
Brian: The owner of Zappos.
Andrew: Yeah.
Brian: You’re right. Someone could take our manual. I still think our manual has a lot of experience into it too, that you can’t just throw this manual into another proofreading business, and they’re going to be able to run with it, because we have competitive advantages in a lot of other areas that they probably don’t, as far as our website, our customer base, our lead generation. You’re perfectly right. Tony realized the same thing. Culture is something that, really when you boil it down, your culture is the only thing that can’t be copied or mimicked. The manual is something we’ve developed. Culture is something I’m trying to get better at.
Again, I’ve gone from me, to now having 35 contractors and four in-house employees. Culture is a challenge. I’m used to coming in if I’m in a bad mood, and I didn’t have to talk to anybody. I didn’t have to give a shit. Now, if I’m in a bad mood all day, it affects other people, if I’m always nagging, and I do. I do this. To be honest, I manage through the experience of my high school basketball coach. I manage like he did. It was definitely 10 to one, negative to positive. It’s bad. It’s bad. I think someone could steal that manual, and I’m sure they’d get some tips, but there’s a lot more to running a successful business than just what we have in that manual.
Andrew: I don’t want to blow it off too soon because I have to put myself . . . It’s easy for me to say that when I’m just an interviewer, but I always have to put myself in the place of the entrepreneur because that’s what I am too. Definitely, everyone who’s listening to me is entrepreneurial. I’m thinking, ‘Yes. There’s more to Mixergy than this manual,’ but when I show people how to do these interviews, side-by-side video, I show them the way that I structure the interview. When I show them the way of every part of it, they go out and do it. No, they haven’t copied Mixergy. I mean, no, they haven’t taken down MIxergy. No, they haven’t replaced Mixergy. No, they can’t copy the culture or my connections to past guest. When I see everyone’s interviews look just like mine, I can’t help but feel that to the audience, I look like just another interview site. When somebody copies your whole process and does everything like you do, including follow up with your customers and maybe add them on social networks the way you do to befriend them there, I can’t help with feeling with that someone who worked with you and works with your competitor and goes, “Oh, this is just the way things are done in this phase.” They don’t give you credit. They don’t feel like you’re special any more. This is how things are done. When you get something proofread, you of course get this follow-up: tweet, friendship, in this phase. And all that stuff that you do. Isn’t that a legitimate issue?
Brian: It certainly is. But I think that’s the beautiful thing about America and our capitalist system is we’re free to copy. I mean I’m guilty of it too. I’ve copied. I definitely wasn’t the pioneer in the proofreading business.
Andrew: But now you’ve gotten this document that anyone can take and read and copy you. And you’re saying, “Hey, you know what?” Here’s what I’m hearing you say, “I don’t want to push too far on this and spend too much time on this boat.” What I’m hearing you say is, “Andrew, this is a real risk but, the benefit far outweighs the risk. The benefit of knowing that I have a team of people who could handle this company and can grow it with me and can help me go from 8,000 to 40,000 to 60,000 to soon 90,000. That far outweighs the negative of somebody possibly copying the document and then copying my procedures at a competitor.” Is that right?
Brian: Oh, by far.
Andrew: OK.
Brian: By far. Yeah.
Andrew: All right. And I said earlier that there is a danger to doing an interview like this which is one the reasons why I ask new companies to wait before they say yes to Mixergy interview. You had a competitor, I know, who watched your interview here and watched your course.
Brian: Well, I cannot 100% guarantee it was my competitor but one of our biggest competitors is from Chatham, Canada. And I was here late at the office one night. And we have that live chat button in the upper-right hand corner of our website proofreadingpal.com. And we can see who’s at our site at one time. We can see what page they’re on. I took that interview that you and I did because there was a way to embed the code and I embedded it on our blog. And lo and behold, there was a visitor from Chatham, Canada on my blog for three hours. And they happened to be on that blog article watching that video. So I’m almost 100% sure. And I’ve since seen then that their Google page speed has improved tremendously, which is one thing I taught. That’s the main thing. And they have reduced a lot of their XHTML errors, little things that I’ve talked about.
Andrew: Things that you talked about.
Brian: Yeah.
Andrew: And suddenly, they were doing. So either some random person in the city where your competitor works watched it and they happened to do everything that you were doing or there’s a connection there. And so, is that an issue for you?
Brian: It certainly is but, I still feel like the SEO value of being on mixergy.com outweighs it. I feel like we have gotten customers from my interview. I think that outweighs it. But it is a little upsetting. But you know what? What can we do? Again if that company wanted to go out and hire someone to read books on search engine optimization, they probably would’ve ended up implementing the same things I talked about long term.
Andrew: OK.
Brian: I guess I just kind of summarized it all and laid it on a platter for them.
Andrew: So the SEO value if better than the loss of having a competitor find out about how you do your business. And did you get customers before doing Mixergy before?
Brian: Yes.
Andrew: OK. How many? What kind of business did you get from this?
Brian: I would say at least ten that we could say offhand: authors who have watched your interviews, app developers, small business owners. Actually a guy who, I think, I don’t know if he interviewed but, he watches interview on California. He’s starting up a, I forget the website, but, it’s a used book sales website. He actually wrote a blog article on us and then we proofread some documents for his wife. So yeah, it’s definitely been rewarding and also the comments I receive, especially within the first 60 to 90 days after that interview. People would just email me and say, “Hey, I really enjoyed your interview.” and that’s rewarding too. So, the company that copied us is bigger than us, a lot bigger than us. And so, I think if we were the industry leader, which we’re not, we’re aspiring to be, it might be more, I guess, it might be a little more upsetting. But since we’re still trying to catch some of these other companies, they know a few of our secrets. It’s not the end of the world.
Andrew: OK. I want to find out how you went from where you were to where you are here. One thing that we discovered is you understood that you can’t do everything anymore, and you systemized a process for other people to do it for you. That explains the workload. Talk to me a little bit about how you got more customers, because you were hustling like mad to get customers before. What did you do to go and get even more customers?
Brian: Well, believe in Google Ad Words. Believe in the processes we have in place to cultivate relationships with customers to build topper mine brand equity in their minds, so that they will spread word of mouth for us, is one. That’s with all the little things we do behind the scenes after we’ve got a customer. Then, number two is, we’re not competing on price. We’re competing on quality because we use two proofreaders. Sticking to our guns and realizing that we’re not going to be the cheapest, and that’s not our market. Building a name for ourselves, as far as a quality go-to company if you want high quality proofreading. Those things have helped build repeat business with our existing customers, word of mouth business.
Andrew: I got to dig into that because I feel like I haven’t gotten enough that’s actionable here. Ad Words, we understand. You actually taught the Mixergy course on how to use Ad Words if you’re hustling. If you don’t have a ton of money, and you need to figure out those long tail keywords, you taught the course on how to do that. I get that. Let’s talk about how you kept your customers. What do you do to get people to come back?
Brian: Well, first of all, when you’re a new customer, we have a custom CRM that we’ve built. We know you’re a new customer. We know you’ve never ordered from us again, because you show up as green in our system.
Andrew: OK.
Brian: We’re going to call you, and we’re going to. . .
Andrew: Some people call me right after I buy for the first time?
Brian: Usually, after your project has been completed.
Andrew: OK.
Brian: Sometimes, the customers haven’t had a chance to review their document. Many times, they have. We’re just going to follow up with you, make sure you received your document, answer any questions that you might have about our service. A lot of times, people don’t know how Track Changes works. Just little odds and ends they don’t understand. It’s the first time they’ve ever used a proofreading service. We’ll address those situations. If there’s a quality concern, we certainly want to make sure that’s taken care of. Usually, the person doing these courtesy calls is a skilled in- house proofreader themselves, so they can answer the question right then and there. If it’s something a little more taxing, we’ll actually send that document through, and it’s a second proofreader on that project. It’s their responsibility to go through it again and fix anything or address any concerns that customer had. We’re always making sure that the customer knows, gets any questions answered, and is 100% satisfied.
Then, the final pieces we stress in the call. . . A lot of customers that ordered from us, they still don’t realize that they got two proofreaders. They always talk about, ‘Can I talk to my proofreader?’ I can tell from their dialogue that they don’t know that two proofreaders were on it. We stress that two proofreaders proofread your document. We’re available from 8:00 am to 10:00 pm every day. If for some reason you ever don’t get your email to download your document, you can always use the order status link, because that’s a problem sometimes. People ordered a six hour turn around, they need their document. For some reason, AOL, the document went to their spam folder. We want them to know that they can access it a different way. It’s really that courtesy call follow-up that hardly any internet companies are doing, that I think adds some value, really builds a better relationship with the customer.
Andrew: Brian, I tried doing that, I think after I heard that you do it. What I found was, I go to voice mail a lot. Nobody answers there.
Brian: We have a scripted voice.
Andrew: Sorry?
Brian: We have a scripted voice mail. Yeah. If it’s voice mail, our system, we have a scripted voice mail which stresses our main points: two proofreaders, 8:00 am to 10:00 pm customer service, order status link. We want them to know that and just hear the word ‘proofreading pals’ as many times as possible in that voice mail. We’ll mark them as ‘called, left voice mail.’ We’ll try one more time to reach them the next day. If we don’t get a hold of them then, we just mark them as ‘called.’
Andrew: OK.
Brian: Yeah.
Andrew: You probably end up with more voice mails than human pick-ups. Right?
Brian: Yeah. Yeah. I’d probably say yeah. Yeah, I’d probably say 60% voice mail, 30% human pick-up.
Andrew: OK.
Brian: Maybe with our system we might end up reaching half of the people, after the second call.
Andrew: All right. And actually, I guess, if you make a first call to me as your customer, I don’t pick it up. I hear your voicemail. I connect it to the phone number in my mind, at least the area code, I connect to the voicemail that you left, then when you call back, I now know who it is and I can decide whether I want to talk to you or maybe I’m good. But your point is, you just want them to know that you did the work and how you did the work and how well you did the work for them and that’s one of the reasons why you get people back. What about this? Somebody buys proofreading service, they don’t necessarily need to return to get more of it the next week or the following month. And you just drop off their radar and you can’t even send them email newsletters about proofreading to get them back. What do you do to build on your business by getting repeat business?
Brian: Well, those people, the whole idea of sending occasional email touches, the happy birthday email, the courtesy call that hopefully builds a better relationship. That person who ordered the resume, and they might never come back, my goal is they are out at an event or something. Who know where the situation might take itself where they’re talking with someone who has someone who has written a book and they need proofreading or has somebody who is in graduate school who needs some help with their papers. That little bit of brand equity we built in their minds that they can remember proofreading pal.
Andrew: OK.
Brian: Oh yeah. I used a company called Proofreading Pal a year ago to proofread my resume. You should have him check it out. That’s the whole goal. So other than that, trying to really build a initial little house in their mind, we’re not doing much down the road to customers who are not going to come back over and over again.
Andrew: OK. Your cousin, way back in Christmas, was using YouTube and he found another way that you grew your business which was?
Brian: Google remarketing. So we have several different remarketing campaigns rolling on Google right now, and for those of you who don’t understand what Google remarketing is, it’s pretty slick. Someone comes to your website, whether they came organically, through a paid ad, through a referral, through Facebook, you can set up certain tasks that they need to complete, and one of ours is if they start a check-out. At least they were commercially [inaudible] enough to start a check-out, they’ll go on a remarketing list. And then anywhere they go on the internet, they could go to cars.com, they could go to mixture g, if you’re running Google ads, probably not, forum or something, CNN. Anywhere they go, if that website’s running Google ads there’s a chance that our ads will follow them around because we know they were interested enough to come to our site. Even start a check-out process, they might have got busy, someone might have called and interrupted them but they’re gone now. We want to be in their lives as they travel around the internet for awhile because the chance they’re going to come back is much higher. Or the chance that maybe we might have been too expensive and they tried someone else. We get this a lot. We were too expensive. They tried someone else and they weren’t happy with the quality, then they come to us for their next order. So Google remarketing is something we’re doing and also if you watch one of our YouTube videos our ads will follow you. So my cousin at Christmas was like, yeah, your ads are following me all over the internet now, and he didn’t understand what it was. I was like, oh, you must be in our Google remarketing list.
Andrew: So if you put videos up on YouTube and if somebody watches one of those videos, then you start remarketing them throughout the internet?
Brian: Yeah. They go into another remarketing list, yeah.
Andrew: OK. What kind of videos do you do on YouTube?
Brian: Well, we’ve got two. We’ve got my little advertisement video that is on our homepage. It’s about two minutes long. On YouTube now, you can pay to advertise your video. And so we’ve got in-stream advertising. We’re advertising on Youtube keywords, things of that nature. Then we’ve got another shorter, thirty second little animated video that basically just accentuates our core competencies and competitive advantages and that runs around on the internet too, on YouTube.
Andrew: I see. So you’re buying ads, where you pay every time someone plays that video and then if someone plays that video, you retarget them throughout the internet?
Brian: Yep.
Andrew: I see. OK. So now we’ve got tactics. Let’s go a little bit broader and understand strategy. How do you know that this is going to work for you, retargeting will, and YouTube will work and AdWords will work and other things don’t? What’s your process for figuring out what the right method is for you? What the right approach is?
Brian: Google Analytics is really our compass, and it’s hooked into our shopping cart. To be honest, some of the stuff, especially the remarketing and some of the YouTube advertising we do, some of the content advertising we do, when I look at the analytics data it doesn’t necessarily always look that good compared to our search. Our AdWords search is, boom, I can see 7% of the people who clicked on this keyword converted. It’s a hot search. Someone is out there searching for proofreading. With the remarketing, with the YouTube advertising and with all our content ads, our analytics data is a little grim as far as conversion rate and stuff like that, average cost per conversion. One thing we know is we know our lifetime, or right now what we think our lifetime value of the average customer is, we can kind of use that, but there are a lot of other factors I use to decide if it’s working. Just because something isn’t necessarily looking that good in the analytics, a lot of our authors who write 50,000 to 100,000 word books, they’re calling in to get a custom quote. Some of these quotes are ranging from $1,200.00 to $2,500.00 to proofread and edit their book. That transaction never is going to show up in analytics.
Andrew: I see.
Brian: It’s all happening off line, and those sorts of leads could be coming from our YouTube ads or our remarketing, and it’s never actually monetizing in analytics.
Andrew: Is what you do, do you test out lots of different ad approaches, tweak them all, and then the ones that work are where you invest more money and the ones that don’t you just move on?
Brian: We do testing, and I still think I don’t test near enough. Our AdWords is set up, at least in my opinion, so well that there’s not really much more testing I can do. I just eliminate negative keywords quite frequently. As far as my content ads that are running on Google, I look at all the different websites that send up traffic, and I find out which ones converted. I might spend more money, like there’s a website out there called toptwentysites.com, and it lists the top 20 for anything. We’re showing up top 20 proofreading sites. I looked at that, and we’ve gotten like 12 transactions from our ads running on that site, which is way better than a lot of the other sites, so I’ll increase my bid to show up on that site a little higher, but testing is important. We’re probably not doing as much as we should be.
Andrew: No, it seems like what you did was you said, I’m just going to stay within the Google world, and the Google world means Google ads, and I’ll just work like mad until I figure them out, and that’s where I’ll make the most of my traffic come, right? And then you ventured out a little bit, and you’re not trying everything. You’re not buying Facebook ads one day, Twitter ads the next and so on. You’re staying within that world. We understand that the Google world is where you’re getting a lot of traffic, including the retargeting campaigns they have in AdWords. We understand that once you get a customer you bring them back. You talked last time about search engine optimization. Is that still a big thing for you?
Brian: Yeah, definitely. We actually moved into number one position for several keywords; resume proofreading service, professional proofreading service, essay proofreading service, student proofreading service, academic proofreading . . .
Andrew: What did you do differently that suddenly you’re climbing there?
Brian: I don’t think we’re doing anything differently, I think it’s just time. Last time we spoke we were only a little over two years old, maybe? No, not even.
Andrew: It was January 2011, so not even.
Brian: We turned three in April. We were a little over two years old. No, not even two.
Andrew: You started in 2010, and this was January 2011. You weren’t even a year old. Maybe you were about a year old.
Brian: Okay.
Andrew: What you’re saying is it just needed some time for search engine optimization to kick in and really rank you higher. Alright. I’m getting a lot of stuff here, but I’m not getting anything that’s mind blowing yet. I’m trying to think of this as, like if you and I were in the audience, and we had a guy say, ‘I went from 8000 to 40 to 60,000 a month. What I did was buy more ads, wait for search engine optimization to work, and then kept my customers happy by calling them up.’ You would feel like I didn’t get enough value there. Give me more. What else did you do to rise so much?
Brian: To grow so much?
Andrew: Yeah. To grow your revenue so much. I’m not seeing enough here.
Brian: OK. The foundation was built. That’s what I know how to do, is start a fire with no matches. We had the foundation built.
Andrew: OK.
Brian: I think the main thing was adding. . . To be honest, it’s been adding qualified people to the company. We have James, who is just excellent. He’s got his undergraduate in English, and he’s got his Masters in Fine Arts from University of Iowa Writer’s Workshop, which is one of the most prestigious writing schools in the country. We’re just funneling people from there into Proofreading Pal.
Andrew: You mean customers from there.
Brian: No. Proofreaders.
Andrew: Proofreaders. You’re about to tell me how getting more proofreading increased your quality, then your business went up. I don’t see that. I use Proofreading Pal. I didn’t care what qualifications they had. I just said, ‘You know what? I trust this site. Great. Take it.’ That’s not why I did business there. What else?
Brian: It’s scaling and growing, while maintaining quality. What we’ve been able to do is bring in talented proofreaders. Probably even, we’re more talented now as a proofreading staff than we were when I talked to you back then, by far. We had proofreaders on our staff back then that we were just kind of bringing in anybody who could somewhat proofread, just because we needed that ability. Our talent level, the quality of proofreading we’re giving you, not necessarily, you don’t care about the qualifications. Just the end product we’re giving to the customer is top notch.
Andrew: OK.
Brian: That is part of our growth in word of mouth. It’s also being able to delegate tasks to our in-house employees, so that I can continue to develop the website and do these more, these interesting internet marketing. . .
Andrew: Like what? What else did you do? I do want to understand the structure of the company that supported this growth. First, let me understand a little bit more about the growth. What else did you do? What are some of the interesting internet marketing things that you did that you said helped grow the business?
Brian: I don’t know if you could really call them interesting, Andrew. More attention to our Facebook.
Andrew: OK.
Brian: More attention to our corporate account system that our customers, who are high volume customers, they get their own username and password. More attention to our back end of our website, which is what our proofreaders see, our outsourced proofreaders. Creating competition with them. They get a medal if they do so many projects, they reach the 500 project club. They reach the one million word club. In growing that all the way out, developing a systemized system in our back end that gives our proofreaders who are doing a high amount of volume bonuses. If we can get more production out of our current staff, it means less training, less hiring, less recruiting we have to do to go out and hire new proofreaders. I don’t care how good of a proofreader you are. When you first come in at Proofreading Pal, there is a learning curve just with the way we do things. If we can get more production with less, I guess, pieces to the puzzle, that helps our overall quality.
Andrew: You mentioned Facebook and corporate. Let me spend a little time on that, if you don’t mind. How does working on your Facebook profile increase your business?
Brian: It increases our top of mind brand equity. It increases interaction with our customers.
Andrew: There’s no way that you can actually directly tie it back into orders, but it does increase business because people get to know you better.
Brian: Correct. Yeah.
Andrew: OK. You also mentioned corporate business. What are you doing to bring in more corporate business where you can get a lot more repeat sales?
Brian: Well, not enough, to be honest.
Andrew: OK.
Brian: We have corporate customers. We need to start identifying them earlier, so James can call them and turn them into a corporate customer. But basically what we do is we’ve had customers contact us with unique needs. We have an advertising agency in New York who wanted a 90 minute turn around and they want us to do special things as far as verify addresses, verify quotes of author’s on Amazon. They’re creating ads. A lot of them are ads for publishes. So basically we just adapted our corporate account system to cater to them so they’d have a special price, they’d have special proof readers tied with their system. Then we have another corporate client in Austin, Texas who produces a lot of blog content. They couldn’t afford our two proof reader system. They wanted a second set of eyes, proof reading only before the content goes out on the internet. So we are able to tailor a system to them.
Andrew: You mentioned that James is a salesperson. How does James bring in new sales?
Brian: Well James started out, he’s a proof reader and just did well and interacted with customers well. So we had a need to run our inbound sales and also run our large products. When we get these big large products we don’t use two proofreaders, we just pair it up with one of our best ones. It’s just too expensive, so we deal with one proofreader. We have some cool systems in place. We’re using Salesforce now so must of it is inbound. It’s inbound people want a quote for their…
Andrew: And then James calls them up and converts them into customers.
Brian: Well we take the call and we have some internal processes we go through with a new customer who wants a quote. Based on information we’ve gathered we put them in a sales force and we decide on how aggressive we’re going to be following up with them based on how they were. Basically James has taken the inbound calls, put them in salesforce, and all other staff has been trained on how to do this too, but James is the follow up guy. So someone didn’t convert with him the first four days. We follow up. That’s key, that’s crucial. We just got a customer who actually before I even hired James, I was following up with. He’s a year old, a year old lead, and he finally converted nine hundred bucks. A year and a half later, why? Because we had him in our system an we stayed diligent with him. It’s that but now what I’m trying to do, we need to get…James is still, he’s our sales guy, he wears a lot of hats, he’s kind of running the show every day Monday through Friday in the daytime. We need to get the secretary in place to free up more of his time to focus on just sales related.
Andrew: Does he do outbound calls to?
Brian: That’s why we need to free up more of his time?
Andrew: But you haven’t done outbound, you’ve tested it?
Brian: We haven’t done any called out.
Andrew: But if someone comes in, calls up, I’m sorry, either they call up or they ask for a quote, usually what would happen is you would respond, most people frankly, I think I would too, just respond quickly to that person. Hopefully I’ve converted him into a customer, maybe not, you’re saying no. Put that guy into Salesforce, make sure he gets the right answer but that you also know how to follow up with him and convert him. Anyone who has gone through the process of asking for a quote is interested enough in being a quality potential customer, you want to be on him, and that’s what working with James does.
Brian: Correct.
Andrew: Okay. Sorry if I’m, am I coming across to you like a bull dog, because I’m worried that…
Brian: No not at all.
Andrew: No. I’m persistent but I don’t want to be a jerk. And I don’t want to be a jerk to the point where I lose the quality of the conversation. So let me continue. I just want to be a jerk to the point that I can be useful to you and to the audience. So we’ve got add words, I wrote down retargeting. What is it actually called with Google?
Brian: It’s, I believe it’s called Google remarketing.
Andrew: Okay so we have add words working for you, remarketing works for you, you also follow up with customers afterwards to bring them back so that you get repeat business from them. You also have James and soon a whole process in place to do sales calls with people who ask you for quotes. You mention lifetime value of customer. I wanted to hold off on that but I think now is an important time to talk about it because understanding lifetime value of customer doesn’t seem like a marketing tactic but it really is because…
Brian: Because it allows you to realize how much you can spend to attract a new customer. If you looked at our Google Analytics, we’re losing money every time we get a new customer. We know right now that our average lifetime value is well more than what we’re spending on Google. That’s the average lifetime value of customers. It’s important to know that figure, and it’s always changing. I think our lifetime value of customers that we think internally, it’s probably a little conservative. I think our real average lifetime value of customers is probably higher than what we think it is right now because of our business accounts and things of that nature.
Andrew: I talked to Gagan Biyani, a former Mixergy interviewee, about how he got Udemy to grow so fast. He said one of the things he did was, he had a system in place to really micro understand the lifetime value of customers by source, so that he could cut off the ads that aren’t working well and continue with ads that do. He talked about how he has his own system to do it. You and I don’t have that. The person listening to us doesn’t necessarily have a system that will tell them right down to the source, how much each user that comes in is worth. I talked to Noah Kagan about that, past interviewee also, and he says, ‘Andrew, you don’t have to make it so hard. What you should do is, every time someone cancels, go back and just see how long they were with you, then just get a sense of what the lifetime value of customer is. Somewhere between that quick solution that Noah suggested to me and anyone else who doesn’t have a system in place and Gagan’s solution, that’s high-end, there’s something in the middle that seems to work for you. What are you using to understand the lifetime value of your customer?
Brian: I’m taking revenue divided by the amount of customers.
Andrew: Overall revenue by the overall number of customers.
Brian: Yeah.
Andrew: OK. It’s just a quick back of the envelope way of seeing what a customer is worth to you.
Brian: Yeah.
Andrew: OK.
Brian: Yeah. That’s why our lifetime value is more accurate than not having it at all. I don’t think, it’s certainly not down to the. . . it’s not fine tuned.
Andrew: It’s not the best mathematical approach because. . . You know why it is, but let’s just be open with the audience about why that doesn’t work perfectly.
Brian: Well, because there’s lots of customers who maybe use this 100 times. There’s some customers who only use this once. Maybe the whole resume sector of our business, maybe that whole sector is actually unprofitable altogether because those customers will never come back. But we’re lumping them in to the whole group of customers. Whereas, the business side, yeah. I think that’s way more profitable than the resume side. When we first started, we were scrounging for anything and everything we could get. The lifetime value gives me some confidence, as far as knowing, ‘OK. We’re spending this much to get a customer. I know this is how much a customer is worth right now, based on these crude mathematical algorithms we’ve come up with.’ I’m sure we could fine tune it a little more, which would probably be to our benefit.
Andrew: You got to use the tools you have, not the ones that you wish you had. Alright. I understand that. Now, let’s go in and understand what you do on the business side of things to be more efficient. That’s not directly related to increasing your revenue, but it is absolutely related because if you make more money per order, then you can spend more money to bring in a new order when you’re doing paid ads. If you can make more money per order, then you can. . . If you can do better service, I should say, then you are going to get more people coming back in. You had this issue before where. . . Let me see if I can find it in my notes. No. I’m looking in the wrong place. I want to just. . . Usually, I can just pop right in with what I want to do. OK. Here it is. You’re paying in-house staff an hourly rate and a separate rate for when they proofread. What do you mean by that? This is from my notes on your pre- interview with Jeremy.
Brian: We found that my first few hires I made, the individuals did not have proofreading ability. They were answering the calls, then they could not problem solve with the customer on grammar related questions, because they didn’t have that sort of knowledge. We decided to make the switch to everyone we hire here at Proofreading Pal to just do normal tasks has to be able to proofread. As a small business, we were requiring these people to wear several hats. We couldn’t afford to just pay them an hourly rate to sit there behind the computer and answer the phone if it rang once every hour, or a chat came in, or put out a fire. We needed to find ways to really utilize their proofreading ability. What I decided to do was create a special class for them in our system where if they could proofread in their downtime to make more money, they’re paid a much less rate than what our outsourced proofreaders are paid, because they’re already getting paid an hourly rate. It was a way for us to compensate our people with PhD’s. We have two PhD’s on staff, in-house here at Proofreading Pal. To compensate them to where they can make an earning that’s fair. Also, it’s saving Proofreading Pal money because we’re not spending as much as we would if that whole project was outsourced.
Andrew: You have the person who answers your phone, who you need to staff in there, that person also does proofreading, but you don’t want to pay them. How does the bonus work? Why don’t you just say, ‘Hey. I’m paying you to be here all day. When I need you to answer the phone, answer the phone. When I need you to proofread, proofread. At the end of the day, you’ve earned your salary for the day.’ Why isn’t it that simple? Why do you give them a bonus?
Brian: Well, because our base hourly is a little bit lower, I guess. I would just feel, someone working with a PhD here, that they should be paid more than what we’re paying them for their base hourly. The way to get the extra money is to proofread.
Andrew: I see. If they’re just doing standard office work, they’re earning one level. Once they do proofreading, you want to pay them more because it’s worth more to you, it’s worth more to the company, and you’re paying others more.
Brian: Yeah. It’s basically a way for them. . . They’re still making the base hourly, no matter what they’re doing. If I’m here. . . Some of them, if they’re busy, and it’s late at night, and I’m not here, why not? How am I going to stop them from surfing the web or something in that down time? The proofreading is an incentive to make more money. That created another problem. These people right now, with where we’re at in our business, they all have to wear several hats. They also have to be able to handle inbound sales. If it’s Saturday night at 9:00 at night, we need them to be able to handle an inbound sales call and spend the attention necessary to give that customer the information that they need and educate the customer on our service. If you’re sitting here, getting paid to proofread, and you can make an extra $6-$7 an hour proofreading, why spend time with that customer? Why not just say, ‘Oh, yeah. Here’s how much it costs. Call us later.
We also built in sales commissions for our in-house people, so they can make. . . If they spend the amount of time necessary, and that customer converts to a sale, they’re going to get a commission on that sale, off the top. Really, if someone comes in, works hard as an in-house proofreader/customer service representative, you can make some decent money.
Andrew: I see. I see what you’re saying. OK. Whenever you saw that someone wasn’t taking something seriously enough, or when there was a danger that they wouldn’t, you aligned the incentives. OK. What about this? You went to the Dave Ramsey Entrepreneurial seminar that taught you something about management. What did you learn from there?
Brian: Well, I learned. . . Basically, Dave Ramsey is. . . I don’t know if you guys heard of him. He’s the financial guy. He believes in no debt, which I disagree with, as far as taking out debt to buy appreciating assets and things of that nature. He runs a business very efficiently. He puts on these conferences in Memphis, Tennessee, called ‘Entre-leadership.’ Basically, the ins and outs of how they run their business. Everything from hiring, training, management. I would say, man, there’s so many good things that I picked up from that. Really for me, it was just realizing, ‘Oh my God. I come in the office everyday, and I’m so much different than what they’re telling me I need to be like.’ Culture, just the word culture there was just spewed out, how culture is so important in the interview process, and hiring the right people, because you bring in the wrong person, and it can cause months of problems down the road. Let me think. If we want some tangible items. . .
Andrew: You don’t have to come up with it on your own. I’m an interviewer. I should be the one who’s coming up with the right questions that will bring this out who’s coming up with the right questions that will bring this out of you. Starting with this. How about this? You talked earlier about how your management style came from a coach that you had, back when you were a student. It was, I think you said, nine negatives to one positive. ‘Hey, you suck. Come on. Hike up that skirt, little girl, and get over to the other side of the court.’ That kind of approach. What you learned from this seminar was the opposite. How do you do it? How did you learn about the feedback that you give?
Brian: I’m still not doing it near like I should, but it’s the total opposite. You need to be positive. Really, when someone does a good job, you need to really accentuate that. Blow that up. Someone just took an inbound sales call, and they closed it, and they did it exactly how you want it. You need to make that. . . That’s awesome. You need to really make them feel good about that. That buys you more opportunity to correct or bring up some of the things that maybe weren’t done correctly.
Andrew: I see. If all I do is walk around the office saying, ‘Hey. That’s not the way to handle a sales call,’ or, ‘If you want to do it even better, here’s what you should be doing,’ or, ‘Why don’t you show up earlier in the future?’ If you do these, if all you do is criticize like that, then you’re not having as much impact. Sorry. Then, you’re coming across as just. . . ‘Please. What? What’s the problem with that? Your job is to correct people. You’re paying them. If they don’t show up on time, shouldn’t you be saying, ‘Hey. Show up earlier.’ If they’re not closing a sale right, don’t they want you to tell them where their flaws are and fix them?
Brian: There is no problem with that, but if that’s all you’re doing, if it’s always negative. To be honest, I’m still bad at it. I went to this conference in December, so it’s only been a few months, and I have a long ways to go to improve. It’s just if you put yourself in the employee’s mindset, Andrew, and you come in the office everyday, and everything you get is just negative, you do something good, and that’s just brushed under the rug. You were five minutes late, and that was brought to your attention. That starts to create a culture of resentment. It’s not a healthy environment.
Andrew: No. I know that I start to get in my head about it. If I went to work for someone where all they did was talk about how I could do better, I would first feel like such a failure. I would obsess about it, then I would start to think about why they were wrong. ‘No. I’m not a failure. This guy’s an idiot.’ Alright. I see what you’re saying. One of the things you learned was to be more positive in your feedback, to catch people doing things right, as Dale Carnagy [SP] used to say.
Brian: One other thing I learned. I haven’t done this yet because I haven’t made any new major hires. Another thing they do is their management. They have a structure where one manager is in charge of between four to six people below them. It structures all the way up. Really, if you’re the manager to these four to six people, you are really responsible to get to know them, know what’s happening in their personal lives, so that you can better relate to them. Maybe there is a reason why they have been poor the last two weeks, because their daughter might have cancer or something like that. Those sort of things are things that you need to be thinking about. You need to develop a better relationship with your employees. It’s hard, but it’s just good to start thinking about it, at least where I’m at. I’m sure there’s people who watch this show that are already excellent at this sort of thing. For me, it’s an area that I struggle with, with the stage of my business right now.
Andrew: OK. I’m challenged by that too. How do you know what’s . . . .
Brian: The thing was, when you do a major hire or any hire, they require that when you narrow it down, you go out to eat with that person and their significant other. They have found that that significant other can sometimes bring things up. One time, they were going to make a major hire, and the guy’s wife was like, ‘I don’t know why you’re hiring him,’ when they were out to eat. ‘I don’t know why you’re hiring him. He’s lazy. He doesn’t work that hard.’ They ended up not hiring the guy.
Andrew: I see. Who the hell is married to someone who would tell a potential boss that they’re lazy? Let’s see what else. What else? You change your checkout process to emphasize your competitive advantage and to emphasize testimonials. How has that impacted business?
Brian: Well, pretty good. This is, I guess, this is something we did tests. First thing we did is we took the prices off our ‘start now’ buttons.
Andrew: Why?
Brian: Curiosity. We wanted people to be curious. They could do the numbers in their head. What we found was, it’s .023 cents per word. My theory was, they were getting their calculator out. Again, we have a lot of. . . Our customer base is pretty big, so we have a lot of people. Maybe they’re not that good with math, but they might just be typing .23, which is $0.23, times 2000, and getting this astronomical number. They’re scared away right away.
Andrew: I see. What you used to do is, on your buttons, you didn’t have an absolute price because you couldn’t give people an absolute price until you knew how many words there were in the document. What you would say is, ‘If you want it this quickly, it’s this much per word. If you want it that quickly, it’s that much per word.’ I see what you mean. Maybe someone even doing it in their head, not pulling out a calculator, would get it wrong. They think they know how to do math. They don’t know how to do math. You’re saying that they get freaked out by the higher number, and they back away. That’s what you think has led to increased sales, when you removed the prices off the buttons.
Brian: It led to increased check one processes. Step out, check one, or check out, step one. About a 25% increase in the amount of people who come to our site would go to step one of check out. That’s beneficial because 25% of people more, now see this is how you submit your document. That was one thing. Then, we decided on actually step one of check out, to accentuate more of our, I guess, core differences versus other proofreading companies. We did just little things. In the right column, we added two proofreaders on every document, just a little banner. Then, we still have our trust logos, the McAfee and SSL certificate, letting people know we accept all major credit cards, just little things to make people comfortable. Then, the testimonials are actually customized. If you select resume, and you go to step two, our system now knows you’re a resume customer.
Andrew: OK.
Brian: It will provide you, at step two of checkout, the testimonial changes to resume.
Andrew: To someone, I see, someone who bought a resume and was happy with it. How do you collect your testimonials?
Brian: Man. We get a lot of them through our courtesy call follow-ups. I’m giving away so many secrets.
Andrew: Do it, baby.
Brian: Our CRM system, just because we call you once doesn’t mean we’re never going to touch you again. Based on our internal algorithm of how long it’s been since you’ve come back or how many times you’ve come back, we do follow-up email check-ins with you. Those are our opportunities to harvest a testimonial as well.
Andrew: You built your CRM yourself?
Brian: Yeah.
Andrew: You did.
Brian: Yeah.
Andrew: In-house, using what?
Brian: I project managed it, and we used my web developer to build it.
Andrew: OK. Wow.
Brian: Yeah.
Andrew: I think you showed the back end of it in your course. You talked about how when someone buys from you, you befriend them on Facebook, you connect with them in different networks, maybe you follow them on Twitter. Do you still do that?
Brian: The Facebook thing got shut down because we were sending out Facebook friend requests from my personal Facebook account.
Andrew: Yeah.
Brian: Facebook didn’t like that. They must have an internal algorithm, and they noticed we were sending too many Facebook friend requests to people who were so far out of my sphere that they said, ‘If you do it anymore, you’re going to get kicked off.’ I tell you what. I don’t mess with Facebook anymore.
Andrew: No.
Brian: Did I ever tell you my story?
Andrew: No. What happened?
Brian: Back in like 2006 or ’07, it’s a Game Rosters-related story, which we won’t even go into that. It’s another online business. It was Florida vs. Ohio State in the NCAA Championship, March Madness college basketball. I don’t know what year that was. Facebook, the first couple years, they had really good ‘fill out your bracket’ on Facebook. It was awesome. You could see who was leading and who was going to win the $50,000. You could go click on that person’s name, and you could see. These people, if they win the bracket, they’re going to win the $50,000. It came down to a guy and a girl. It was Florida vs. Ohio State. One guy had Florida in his bracket. One girl had Ohio State. Whoever won this game, they were going to win the $50,000. I contacted both of them, and I said, ‘Hey. Switch your profile picture to say, ‘I love Gamerosters.com, and I’ll pay you $250.” I knew everyone was going to check out these people to see who they are, who’s going to win the $50,000. They both did it, but I put it on their wall. Game Rosters was flooded. I had like 19,000 visitors that day. Facebook, no questions asked, no warnings, just cancelled my whole Facebook account, back in 2007. Gone. I don’t mess. . .
Andrew: And you had to start from scratch.
Brian: We stopped that little process at Proofreading Pal. Facebook said, ‘Don’t do that anymore.’
Andrew: Oh. I have to ask you an important question that I think no one else has talked about here in a Mixergy interview. I’m surprised that you’re willing to, but it’s helpful to know.
Brian: I didn’t say I was going to talk about it.
Andrew: First, let me do two things. I’ve been holding up this mug because I asked my audience, I said, ‘Look. If you guys are building companies based on what you learn in Mixergy interviews, send me your mug with your logo on it. I’ll hold it up in the interviews, let people see it.’ This one came from Team Darwin. The founder’s name is Greg. Along with this, he sent me this beautiful handwritten note. I thought it was actually typed out, it was so well done. You can tell that Greg’s an artist because of his penmanship. Do you have penmanship like this? I can actually read what he wrote. He says, ‘Hey, Andrew. We’re just about to launch Team Darwin, a crowd source ad agency that uses the latest findings from neuroscience to help us and our clients pick the most effective idea. Enjoy the mug, and thanks for all the great interviews and courses. Hopefully, we’ll learn something great that will benefit others. All the best, Greg.’ His idea is to create crowd sourcing. You know how there is crowd sourcing for web design, like 99 Designs is crowd sourcing for logos. He wants to crowd source at an ad agency, let people come up with creative ideas for his customers. I’m surprised he hasn’t launched yet. I got this in the mail from him. This guy is so cool. He sent it over from the UK. He sent it on December 2nd. This is now March 6th that we’re recording it on. I’m surprised he still hasn’t launched. Greg, you have beautiful penmanship and beautiful design. He even sent me the samples of the work that he’s doing. Launch, baby. Launch. Right? Don’t you agree?
Brian: I agree.
Andrew: You talked a lot after your course that you did about how to get customers, where you taught Ad Words here on Mixergy. A lot of people contacted you. One of the things you told me before we started was, you couldn’t believe that people didn’t use it. Right? They didn’t use what they learned from you on the call.
Brian: Well, I guess people. . . I’ve watched lots of your interviews too. I’ve done some courses, and I haven’t been able to find the time to implement everything. I’m hoping that they’re spending their time on something else that needs to be spent on right now. There’s lots of businesses who have started without Ad Words at all. There’s lots of different ways to do it. I just think people need to find something that works, then really milk it until they find it’s kind of plateaued.
Andrew: Alright. Hopefully, by the time this interview is up online, people will be able to go to Teamdarwin.com and actually see the website. I’m looking forward to seeing that. The second thing I want to say is that if what you’ve heard here about systemizing sounds like a process that you need to go through, maybe you’ve been wrestling with yourself for a long time about systemizing the way that I was, and you finally are able to say, ‘Hey. You know what? I heard what it did for Brian’s business. He’s no longer dealing with the chaotic situation where everything comes to him. He’s able to scale by showing other people in his company what he does. I want to know how to do it.’ Well, there are a couple of courses and interviews at Mixergy that you should check out. The first that I’d recommend is Sam Carpenter’s interview. He wrote the book on how to systemize your business. We here at Mixergy use that book as a basis for our processes.
We also did a course with Kelly Asavedo [SP], who talked about how to systemize your business. Actually, I take that back. That’s an interview also. The course is on how to create systems that automate. It was done by Nicholas Glass. Nicholas Green, of Ivy Insiders. Bottom line, we have tons of sessions here, both interviews and courses, that will show you how other people have systemized. You don’t have to do every single thing. My suggestion is, just listen to it in the background as you run, or as you drive into work. Just let the ideas sink in. You’re going to come up with ideas that really fit your business. Those are the ones that you will naturally want to implement because you’ll be excited about them, and you know that they’ll fit well with you.
If you’re a Mixergy Premium member, go to Mixergypremium.com and start taking all those sessions. If you’re not, I hope you go to Mixergypremium.com and sign up. You’ll get access to hundreds of interviews and courses, including the ones on systemizing that are especially good. Here’s one other one. ‘Systemizing Will Liberate You’ is the headline on this interview with Harold Mann [SP], who did a really good job showing how to systemize your business. We really believe in it here at Mixergy, and I urge you guys to try it. Sorry?
Brian: I’m writing these down because I know you said we have systemized. I’m still in the trenches and we’ve got a long ways to go. We are much better but we’re still a work in progress as far as systemizing.
Andrew: What do you listen to for [??] interviews?
Brian: I usually listen to them in the morning, I like to watch them, to be honest. The MP3 is intriguing because you can do that while you are doing something else. I find if I am listening to something in the background while I am still concentrating, it might not work. But if I am out for a run, exercising, or going for a walk, I find this is a great time to listen to them.
Andrew: It is surprising that everyone has a favorite way of doing it. For me, I could never watch the video. All I would do is listen to the MP3 while I cycled or ran. Others need to watch it so they can fully focus. Some others like Bob Hiler who has done a lot of help and work here at Mixergy just wants to read it. I have seen people hit the read it later button on insta paper bookmarklet which sends it automatically to their Kindle and they read the transcript there.
I would actually suggest you start with Sam Carpenter. He provides a really good process on how to systemize. Then move on to Nicholas Greene who shows his computer screen and walks you through how he did it at I B and Snyders. He had a ton of college students who were working for him and he needed them to work in a organized way. He had to create systems. There was no other way to do it. What I liked about that session was since he was no longer at I B and Snyders he could show us his computer screen and walk us through how he did it when he ran the company himself. There was no danger of a competitor seeing what was going on in the company. He would just say this is how we did it a few years ago when I ran it. He could show the actual screen shots and the actual process.
Here is a final thing I wanted to ask you about. You had an investor who had what percentage of your business?
Brian: 50%
Andrew: And today your investor has?
Brian: 40%
Andrew: So this process of reducing your investor’s equity in the business works. I have seen it happen. For some reason I have not asked an interviewee about it or maybe it was something they were not comfortable talking about. You told Jeremy about this. Tell us how you change that?
Brian: Well first of all the initial agreement that we came up with was when we were both rookies at this process. We talked over a few beers at a local bar and we put a couple of ideas together on the table. He wanted to invest in one of them. The other one would require me moving to Vegas. It was video game gambling and I just did not want to do that yet. So, we just came together with the idea of me matching sweat equity with his investment.
Andrew: How much money did he invest? . Brian: I’ll keep that secret. But I matched that with sweat equity.
Andrew: Fair enough. So now you have this agreement. What happened afterwards that made you feel you wanted to change it?
Brian: Well, I think the initial agreement was structured a little bit unfair. But I say that from an investors point. It was blue sky. There was no proof just investing in me. So it was a blue sky investment. Obviously the investor had risks but it was a little unfair. I would have probably wanted more money up front to give up 50% or be paid some way instead of matching sweat equity right off the bat. But we had some other ideas of businesses we wanted to get in to that were language translation related. I felt that business should be separate from the Proof Reading Pal. Our Proof Reading Pal does not need to own the translating site. So, we had a discussion about if we do translation, then I am going to start that by myself. So we negotiated that 10% in where translation would be part of the ProofreadingPal umbrella when we start that.
So you were going to start this new business on your own and he was going to get nothing out of it. Instead of doing that you connected it to Proofreading, and he gave you a bigger piece of the business. That way he owns both the translation and the proofreading.
Brian: Correct. Yeah, we had some other parts where, some of the agreement was, there would be payback to the investor a little bit sooner. That was delayed a little bit.
If I had it to do all over again, I would bring on an investor, because Greg has been instrumental in introducing me to people who have helped us along the way. Kind of a mentor, so to speak.
He’s not a whole lot older than me, but he’s 35 and very successful here in Iowa City. He owns a financial firm, owns a lot of property.
Andrew: This is Greg McLaughlin. He owns several Panchero franchises. What’s a Panchero franchise?
Brian: He’s an investor in several Panchero’s, it’s kind a step above Chipotle.
Andrew: OK.
Brian: Burritos. It’s real quick. They make it in front of you. Basically it’s a Midwest franchise. There might be a hundred of them now.
Andrew: Sounds like my kind of food.
All right. So he invested in that, that’s one of his earlier businesses. He’s also co-owner of a rapidly growing rental property business here, or there in Iowa. Again, I’m reading from his notes.
Brian: Then he owns Business and Financial Strategies, which is an investment firm. I think he’s got 10 representatives now that work for him too.
He played football for Iowa, field goal kicker.
Andrew: Congratulations on getting him as an investor, and on the progress since our last interview. As I told you before this interview started, I don’t want this to be our last one.
I want to hear how your company develops. I’m looking forward to seeing you coming back over an over, and I’m looking forward to seeing those numbers grow.
The first time — I don’t know if you remember this? You and I don’t have any mutual friends. There’s nobody who I can go to and say, ‘Is Brian for real or am I just getting hustled here? Help me research him.’ I didn’t have any of that.
What we did was, I think we did screen sharing, like I did earlier before this interview started. You walked me through your PayPal register and you said, ‘Here’s where the revenues are, and all that.’
That’s surprising, and I appreciated it. It helped me confirm. I can’t ever be 100 percent sure, but it helped me confirm what’s going on here.
The reason I say this to the audience is, I want you to know that I do a lot of work here with the guests to prep them. And also to prep ourselves to make sure that everything we’re covering here is solid as we possibly can make it.
Brian, thanks so much for doing this interview.
Brian: Thanks, Andrew. Thanks for having me. It’s always a pleasure.
Andrew: You bet. As a ProofreadingPal customer and someone’s who’s worked with you here in the interviews, I’m glad to have you on here.
Thank you all for being a part of it. Bye, guys.
