Never Get a ”Real„ Job (18 page)

Don’t
just
hire someone. Ever!
Full-time employees are expensive. In the early stages of your start-up, I advise staying away from them all together. However, if you find that you need to hire someone full time, it doesn’t mean that you should suddenly feel the urge to be less frugal or budget-conscious. Nor should you forget who is taking the real risk by bringing on a new mouth to feed. Consider these things before you put your John Hancock on any employment agreement:

 

• Don’t pay for age
  . Age doesn’t mean a candidate is better qualified, more experienced, or a better fit for the position. You’re better off finding a young, hungry, quick-learning self-starter to work for considerably less money than older job seekers. The only time you should pay for age in the early stages of your start-up is if age comes with a top tier, crème de la crème Rolodex.
  
 

 

• Hire above-market talent for below-market prices
  . Hire employees with a supply-and-demand mentality. There are many more available workers than you’ll ever need for the job you’ll have available, so never pay top price for anyone. Don’t just let someone tell you his or her salary range;
  you
  dictate the terms. And whatever the person’s worth, make sure he or she earns it!
  
 

 

• Avoid big titles with little experience
  . Look behind impressive resumes for inherent flaws. Don’t get gamed. Verify references before contacting them. You never know when someone is using his or her mother or best friend as a reference.
  
 

 

• Test out newbies
  . Don’t rush to put new people on your payroll. Start all employees part time. Establish a trial period during which you’ll field-test them for a while at a lower wage to see how much they’re actually worth. If it doesn’t work out, you can have a clean split without having to worry about paying a severance package.
  
 

 

• Determine exactly what kind of “stuff” job seekers bring to the table
  . It’s important to realize that when you hire new employees, you’re not just on the hook for their salaries and benefits. They also need “stuff”; and stuff has a way of adding up quickly. Every employee you hire will need supplies, computers, mobile devices, and a whole slew of other costly items. When interviewing, find out what prospects own and see if their stuff can bring down your expenses.
  
 

 

• Make sure they pay for themselves
  . The first employees you hire must be revenue-generators. If you’re going to pay more than you expected, make sure you’re getting 10 times the work output they’d expect to deliver. Make them earn every dollar by instilling a no-risk, no-reward philosophy, and building incentives and bonuses into their pay structure. Don’t hire full-time support and administrative staff for your start-up. Again—don’t be lazy. Answer your own damn phones!
  
 

Meet one-callers
. One-callers are individuals who have achieved a level of business and/or financial success that can open almost any door with a single phone call. Even if they’ve never met the person on the other end of the line, their name and reputation alone get the job done. In short, one-callers are living proof that
who
you know is often more important than
what
you know.

Many top professionals are willing to give their time and energy to counsel the
right
ambitious, smart young person. You just need to know how to properly and effectively approach them to prove that both you and your business are worth their time.

Don’t select one-callers simply because they are rich, famous, smart, or “someone you’d like to meet”—because the people on that “dream list” are apt to never return your calls. Instead, construct a list of relevant individuals whose business acumen, track record, industry connections, personality, and credibility have the potential to open doors and take your business to the next level.

However, you can’t just list the titans of your chosen industry on a pad and start contacting them for support. You won’t make it past a receptionist with lines like, “It’s been my dream to meet with Person X” or “I’m starting a new business that Person X needs to hear about.” That voicemail or e-mail will get deleted in a New York minute. A one-caller once told me he would decide to help someone or not in less than 10 seconds—and that’s only if that person could figure out how to get to him in the first place.

Only reach out to a one-caller if you have compelling answers to the following four key points and questions:

Elite one-callers don’t have time to waste. If you’re lucky enough to gain the opportunity to speak with one of these people, you will only have one shot to win that person over. There’s no room for error with your first impression—so prior to your conversation, find out absolutely
everything
there is to know about the one-caller. Say or offer something valid and valuable. Impress them without being a kiss-ass. Show respect without being a fan. Be confident, but not cocky. Relate your experiences to theirs. Demonstrate actual value, real potential, or tangible success. And be able to do all of these things in less than two minutes.

You may be rolling your eyes right now, thinking that this sounds like an impossible task, but I assure you it’s not. These doors can be kicked down with the right boot. Well-articulated cold calls and seven-line e-mails can secure appointments with rock star entrepreneurs, billionaires, and Fortune 500 CEOs; hey, it worked for me. And some of these people are still my closest advisors and mentors to this day. Though one-callers might be in an elite league of their own, they still have something in common with you: They are human beings, and in many instances, they were once in the same position that you’re in right now.

As long as you are smart about your tactics, act responsibly and professionally, and are truly convinced that the one-caller might actually respond, you have nothing to lose. Most one-callers will never give you the time of day—but it only takes one to change your life, and your business.

DO WHAT MAKES CENTS

Although every pundit and his or her mother will tell you to slash expenses and cut overhead, precious few will actually provide a methodology for cost cutting. Whenever I’m in need of a product or service, my first instinct is never to buy it. Instead, I use a six-step process to determine the best method of getting what I need.

Analyzing expenses this way will make you a more fiscally responsible business owner—one who’s never bowled over by their life burn rate. Train yourself to think through every purchase in this fashion. Fight the impulse to reach for your credit card every time you need something.

Live without it
. Purchasing an expensive piece of equipment might move your business forward faster—but it’s unacceptable to put your company into hoc as a result. Just because you “need” something doesn’t mean you can go ahead and simply buy it.

Consider the following questions before deciding to pursue a purchase: Do you really
need
to make this purchase, or would you
like
to make this purchase? Is this purchase a necessity or a convenience? Is there an alternative that will allow you to be just as successful for less? Can you hold off on this purchase until a later date when you have more cash flow to support such an expense?

The best things in life are free
. Creative entrepreneurs don’t just look for free stuff—they also find ways to make stuff free. Think about how you could turn a potential purchase into a freebie. Can you avoid costly software by using ad-supported Web products? Do you have what it takes to master the art of the in-store return policy? Can you string together an everlasting series of trial periods?

Keep in mind that “free” can end up being expensive.
Always
read the fine print to find out the real cost—not just in terms of money. Will you be hampered by a lack of technical support or customer service? Does the product lack quality? Is it completely developed or still being beta-tested? Will you constantly be bombarded by advertisements and junk mail in exchange for the service or product? Does “free” come with time limits, future costs, or strings attached? Is the company that supports the service credible, or a fly-by-night enterprise without an address or phone number?

Promise to give it right back
. Do you only need something for a limited time? If so, see if someone in your social, personal, or business network owns whatever it is that you need. Saying “pretty please” often results in saving a pretty penny.

Put the
art
in barter
. Bartering is an effective way to trade services with another vendor to get your desired product or service. In many instances, it may be less expensive for your cleaning business to clean another business’s office in exchange for its accounting services than it would be to purchase the services outright.

Split the bill
. Whether virtual or brick-and-mortar, every business shares certain products and services; think toilet paper and coffee, for instance. Find complementary, noncompetitive purchasing partners with whom you can split your expenses. These partnerships will also enable you to save money and dramatically reduce your costs by purchasing in bulk or wholesale.

Channel your inner cheapskate
. If you absolutely
need
to buy something, take the time to shop around for the best deal and purchasing options. Never pay retail price if you can avoid it. Be thrifty and aim to get the most out of every buck. Consider these six steps before swiping your corporate card:

CASH FLOW OR DIE!

Plain and simple: Without cash flow you’re dead in the water. And you need to be able to defend your cash flow with everything you’ve got in order to stay afloat. Put the right protocols and systems in place to minimize overhead during your business’s infancy to keep it lean and mean in adulthood.

Enter the market yesterday
. Your clients and customers are your best investors and R&D team. Limit planning time and shorten development cycles to get into the market faster. The bells and whistles can come later, but your essential services need to be validated by the market and generate revenue as soon as possible. Sizzle It! started producing sizzle reels months before we invested in our Web site. Selling what we had allowed us to improve our service to the level that we wanted with cash flow, thereby offering new clients even more reasons to hire us, and old clients more reasons to tell others about us.