Over the weekend we slid into quarter 4 and that’s the end of the first quarter working for myself.
I wish I could say I've already mastered cashflow, selling projects, and creating products but I've only just begun. I think I'm doing a good job so far but I realize that I don’t know what I don’t know and that scares me.
I’ve always had side projects but there’s a huge difference between a side project that brings in fun money and a project that has to pay your mortgage. I need to build up client work and work on my own projects to bring in recurring revenue.
So I’ve decided to hold my self accountable. Not by putting something on my to-do list. But by posting it publicly right here.
I left my last job in August so the numbers won’t represent a whole quarter but you got to start somewhere right?
One Time Revenue – $6,698.95
I’m breaking my revenue into two broad categories. The first is one time revenue. I’m working with clients to optimize their sites. Right now I’m calling myself a holistic optimizer. That means I look at pricing, the marketing message (product market fit), the product itself, the website, and basically everything.
I make note of anywhere there’s a potential gap or opportunity to improve, and work with the client to prioritize that list. Then I help them implement those changes.
It’s nice having this holistic approach. Quite often if you hire a specialist, they only see problems in the specialized area they work in – they have a hammer, and everything looks like a nail problem. My approach let's us tackle problems for any angle we want and so far it's working out.
This quarter I pulled in $6,698.95 from two clients.
Recurring Revenue – $2,013.00
The second category is recurring revenue. Recurring revenue is great for business. It's a lot more predictable than working with clients and it tends to scale better. The downside is that it usually takes a while to get going. You have to build an audience or work with someone who already has an audience.
I've played with different types of recurring revenue over the last couple years and all of them have their pros & cons.
- Selling software is lucrative but sometimes requires you to work nights and weekends to fix a bug
- Books & courses are very easy to maintain and you get royalties while someone else sells them – the downside is it doesn't pay well.
- Affiliate income is nice because you market it yourself. The more you write the more money you make. But there's something about affiliate marketing that feels a bit icky to me. If you get paid to refer someone how can you be trusted? I'm going to be hesitant with affiliate income – I've recommend many products without affiliate programs and I'll continue to recommend the best product regardless of an affiliate program.
Right now most of my recurring revenue comes from royalties on books, courses, and plugins. But there’s also some affiliate income. And in the future I hope to start selling some products and add that in here.
This quarter I pulled in $2,013.00 mostly from royalties.
Grand total that’s $8,711.96. I definitely want to get that number higher so I can buy – you know – things. I haven't been working for myself for a whole quarter yet so I expect this to go up.
23% of my income is recurring.
Profit First – $315.19
A few months ago I read Profit First. This book encourages you to set aside profit before paying any expenses. Which is the complete opposite of what most entrepreneurs do. They pay their expenses, pay their employees, and then see if there's any profit left over.
You know how your grandpa told you, “Always pay your self first” and to take 10% of your check and put it in savings? This is the same thing for your business.
It's a simple system that doesn't let you tempt yourself into making bad decisions. As an amateur business person I'm all for systems like this.
I set aside $315.19 this quarter. And while I'm pretty frugal I'm following the book's advice to treat myself once a quarter on the money I set aside.
This month I'll be going out to dinner with two of my favorite people: Kristie & Aviva. Using my first profit check to treat my favorite people makes me feel pretty good.
I had a whole bunch of projects come in last month but I haven’t finished them all. That means that I have to spend a lot of time this quarter finishing them and while I'm doing that I won't be bringing in more work. :/
I’ve neglected my blog for the last year and I miss it. Writing posts is like working out. It's hard to get going but once you're writing you don't regret it. It’s time to work on my writing habit. I want to share more about e-commerce & more about business.
I’ve found it hard to blog when I could be working on client projects and make money. But it’s something I somehow need to make time for. I expect this will be something that can’t be taught but has to be learned by doing. I’m actually writing this post on Sunday because I’m worried I’ll run out of time on Monday.
I really want to launch my own product next quarter – even if it’s just an MVP. The problem is that I have too many ideas and not enough time. I see potential problems all over the place I need to take my best guess and take a stab at one of these problems.
And of course I need to get my overall revenue up – gotta pay for that mortgage!
- Get my recurring revenue up. I think can get it up to $4,000.
- Blog more – lets say 2X a month to start. I need to get in the rhythm of writing before I can promote my own products or promote other products on my site
- I’m actually happy with my client work. I know I could take on more clients but I think I’d do a worse job. I need to do an excellent job and start writing about the things I’m learning. I’d like to share that and help out other businesses. Perhaps in 2017 I'll look at getting client work up – but for now I'd rather focus on doing an excellent job and get slightly less income. Keep one time revenue about the same.
I'm mostly posting this for myself – but if you want to chat business in the comments I'm all game. 🙂
See you next quarter!