Discover more from The Introvert Entrepreneur
TIE #010: What I've Learned From Making $4 Million+ in Online Revenue
Theory is one thing, but action is another.
Apparently you hate money. If you didn’t, you’d be using Rakuten every time you shop on websites like Walmart and Target to save money.
They have paid me over $8,000 for things I was already going to buy for my one-person business (click here for proof).
They are also the reason this post is free to read. Sign up here and get $30 for free after your first use.
If you add up all of the different businesses I’ve run over the years (mainly e-commerce), my revenue total is sitting above $4 million.
Profit is a different story and is somewhere around 30-40% of that number.
Looking back, I now realize that every product based business I’ve run has the same process for success.
Let’s take a look at what that process looks like.
Your Successful Business Process
There are three main aspects to a successful product based business:
Profit first, everything else second
Compounding those profits ASAP
Grow horizontally, not vertically
You don’t have to get these perfect, but you need to leverage them to the best of your ability.
Here is how to attack:
Profit First, Everything Else Second
Things that don’t matter when you haven’t made a single dollar:
Your logo (if you have a website)
If you have an LLC or not
How taxes on businesses work
How much competition there is
All of that is meaningless if you haven’t made money.
Objective #1 should be buying things and attempting to sell them for more than you paid for them.
If you can’t do that, forget all that other stuff.
Once you’ve started making consistent money, you can worry about the small intangibles.
I don’t know who needs to hear this, but the goal in business is to make money. It is not about spending a bunch of time worrying about crap that does not matter.
Compounding Profits ASAP
Not only do you want to buy things and sell them for a profit, but you want to do so efficiently.
The quicker you can deploy capital and get all of the revenue back, the faster and larger your business will grow.
Take this quote from a recent post:
Let me demonstrate how powerful this idea is with some math:
Scenario 1: Spend $1,000 on a bunch of product and you finally sell all of it 6 months later for a return on investment of 100%
Scenario 2: Spend $1,000 on a bunch of faster selling product that sells out within 1 month, but it only yields a return on investment of 30%. Then, repeat that process 5 times over the same 6 month period.
Scenario 1 profit after 6 months: $1,000
Scenario 2 profit after 6 months: $3,800 (!)
Even though Scenario 2 had product that returned much less ROI, the profit was magnitudes larger due to how often the profit was reinvested.
Time is king.
Compounding is so powerful that if a product you are selling loses steam, you are better off breaking even on the remaining product so you can re-deploy that capital.
The best way I can sum this idea up is this:
The speed in which you can make a profit is more important than the amount of profit you’re making on any given item.
Grow Horizontally, Not Vertically
This doesn’t apply to every business, but applies to most.
When tasked with growth, you should aim to increase the total number of item types you are selling.
Most people think: “This product is selling profitably, I’m going to dump all of my money into more of it and nothing else.”
This is the opposite of diversification and can get you in trouble, quickly.
Let’s say you dump $20,000 into a red hot product.
Then, out of nowhere some whale shows up on the market and offers that same/similar item for half the price it was selling for.
Kiss any chance at profit goodbye.
Had you spread that $20,000 into 20 different products, you’d only be out $1,000 instead.
If you have a giant moat, you can double down on one product. However, most beginners will never have this.
Self-awareness is key.
Profit is priority #1
When you get that profit, compound it ASAP
Grow by diversifying
When you are ready, there are two different ways I can help you:
If you are interested in starting an efficient one-person online business, I recommend starting with one of the following:
Textbook Flipping Mastery - My in-depth guide on how to start a high-margin Amazon e-commerce business.
LEGO Investing Mastery - My in-depth guide on how to start a long-term “buy, hold, and sell” LEGO investing business.
The Conference Room - My private mentorship community that includes the two guides above, for free. Pay once and stay a member for life.
If you are interested following along with my personal LEGO investment portfolio and unlocking access to 4 additional posts each month:
Become a paid subscriber here (7-day free trial available)
The Introvert Entrepreneur is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.