My mistakes and the lessons they taught me
Had I understood these simple concepts I believe I would have made very different decisions in building my business. I would have likely focused less time on maximizing profit (E) and more time investing in future earnings and value (M). The mistakes I made are not uncommon in business. In fact, I made many of them because of the same biases that prevent people from saving for the future or losing weight.
Below I’ve tried to share some examples of mistakes I made that hurt the business’ valuation when I sold it.
Example 1: Content and SEO
I’ve been a strong believer in content marketing for my entire career. In my first job at Highfive we saw success building a a blog audience of hundreds of thousands of readers, many of whom signed up for a free trial of our product and later purchased it. I’ve witnessed companies like Groove, Buffer, and other bootstrapped companies generate millions of dollars in revenue through content marketing alone. So when I started SimpleData I told myself I wanted to invest heavily in content.
Once I was generating consistent profits each month I started looking for an SEO and Content Marketing agency and after a few Google searches found one that seemed good enough. I interviewed the team and committed to spending $2,000 per month. But after the first month I got cold feet and pulled out. Once again, the allure of short term profits prevented me from investing in future growth and value.
At the time I recall rationalizing my decision by telling myself that many agencies over charge their customers and don’t produce results. That logic would be fine if what followed was a backup plan to still achieve the goal. I could have interviewed 5 contractors or asked friends for recommendations on trustworthy agencies. Instead I think that my lower brain felt fear (What if it doesn’t work) and then my upper brain rationalized a bad decision. (More on the lower and upper brain below).