Money is money, and time is also money. There are those who ask for an unscheduled minute and take twenty unscheduled minutes. Dan Kennedy aptly named them time vampires. When you’re a busy executive or entrepreneur, you are juggling so much at all times that every minute in your day is your lifeblood, and unscheduled interruptions are wolves. Don’t let time and money wolves bleed you dry.
The other thing I’ve learned is that the world loves to tell you no: No, you cannot do that. No, you cannot have this loan. No, you will not be able to achieve that. No, you must do it our way instead. No, no, no, no. I hate being told no. When I set my mind on something, I will get it. When I get it, I sometimes realize I really didn’t want it, but I got it anyway because they told me no. Don’t let the “no” wolves deter you from walking your path. Find a way around the no.
Financial Wolves
I’ve always been a “go-big-or-go-home” kind of guy, and I have encouraged everyone who has worked for me to pursue growth. That has worked. We grew really, really quickly, but there are challenges with growing so quickly. We were staffing up too quickly and too heavily partly because I love creating jobs and giving people opportunities and partly because it could often be more propitious to throw another staff member into a department rather than solve and resolve the broken system that person was being tossed into.
At one time, we had over fifty-five employees on staff and it was a little out of hand. Even though the revenue was pouring in, we sometimes found ourselves struggling to make payroll. My empire had gone from a fast-paced think tank that ran efficiently with a lean staff to a bloated kingdom of processes and meetings. It could take four hours to get through some of our staff meetings because we had so many departments and projects.
When I told one of my business mentors about the financial wolves I was facing from growing so quickly and not having the cash flow to fund the next phase of growth, he pointed out that my business, while profitable, was consuming profits for breakfast so nothing was left for lunch and dinner. A major capital infusion would provide a phenomenal boost to my business, keeping our growth trending strongly upward.
Though we’ve always been very profitable, and though our growth rose at a rate of 67 percent over the three-year period from 2013 to 2015, getting cash from lenders for a business like mine is very difficult. Traditional banks don’t always understand an Internet-based business model. They ask, “Where’s your store?” “Well, it’s online.” “Then how do you get people to buy stuff?” “We send them an e-mail.” “Well, but . . . how are you maintaining a sustainable model long term?”
It doesn’t really suffice that we’ve been doing it successfully for years, as have millions of other Internet tycoons of our modern era. Banks need their risks to be covered with collateral, and they don’t even know what to list as collateral if it’s all digital: e-mail lists, Facebook followers, online stores, digital downloads, and clickable ad spots instead of buildings, inventory, and other physical assets that banks traditionally recognize.
Even venture capitalists have a hard time with our version of business because they’re looking for new ideas, new untried products and services. We’re not really selling a new idea. They’re looking for some innovative technology that nobody else has, but that isn’t what we do.
What I have is a business model that has worked time over time and has, subsequently, been imitated by a lot of my competitors. In fact, during the 2016 election cycle, the New York Times called Liberty Alliance a company that “found a way to create something sustainable and even potentially transformational . . . Liberty’s countless news-oriented pages . . . have become an almost ubiquitous presence on right-leaning politics on Facebook in the last few years.”5 Some have called Liberty Alliance one of the most powerful conglomerates in the conservative arena today.
Two or three times, we looked into applying for a Small Business Administration (SBA) loan, but the process is a nightmare for anyone with little spare time. It involves a three-inch stack of paperwork, with demands on format, required projections, budgets and analysis, executive bios, and estimated growth plans. It’s a full-time job applying for an SBA loan. Every time we’d begin, we’d quickly look at the hours the process would demand, shrug, and say, “We simply don’t have the time to stop making money in order to work through the SBA’s loan requirements. We’re making it somehow. Let’s just keep going.”
I was eventually able to get a small bank loan for $60,000 in 2011. By then, we were bringing in $60,000 in a week in revenue, so we hardly felt its benefits. Now we are bringing in revenue of more than $10,000,000 per year, all without a big bank loan or groups of investors. It’s been boot-strapped the whole way. December 7, 2017, will be the tenth anniversary of my break into entrepreneurial pursuits with that first political DVD.
So how have I fended off this ever-present financial wolf? I’ve used my personal credit.
When push comes to shove, I use my personal credit to fund my business. It’s not uncommon among entrepreneurs. The man who started Tito’s Vodka funded his start-up using a wallet full of personal credit cards because he believed in his product so firmly. So did the founder of CheapOAir. And the big one: Google. In 1996 two PhD students worked on their research paper out of their dorm rooms at Stanford University. Two years later, they spread the costs of starting their search-engine company over three personal credit cards.
And yes, it can be scary to put your credit on the line, to possibly risk digging yourself a massive hole of debt to fall into, but you’ve got to make it happen. If you believe in something and you know what you’re doing can be successful, you just do it and kind of figure out the details as you go along.
Especially at the beginning, I had to use my personal credit often, but I couldn’t worry about not being able to pay it off. I didn’t have an investor or funding. The only way my start-up was going to be successful was to fund it myself.
I would use that fistful of credit cards as a line of credit: charge them up, pay them down, charge ‘em up, and pay them down. I didn’t realize the havoc this would wreak with my credit rating until I decided I wanted to buy a camping trailer for my family.
The RV dealer had the perfect camper for $17,000. I wanted it. A good-ol’-boy financier was sitting behind the desk. He asked me how much money I made. His response to my reply was positive, clearly a sure sign I’d be approved for the loan. Then he ran my credit, and his face fell. “I’m real sorry, son, but we’re not going to be able to finance you.”
My mouth fell open. “What are you talking about? I make a lot of money. I’ve always paid my bills on time. What’s the problem?”
“I’m real sorry, son. We just can’t do it.”
There was no way I was walking out of there without that camper, not when I had been working my tail off to provide for my family’s needs. It was time for a want to be fulfilled, and I wanted that camper! I checked my bank account balance on my phone. “How about I write you a check for the full amount?” Man, he sat back in his chair and said, “Well, all right, then. We’ll take a personal check!”
That was a wake-up call for me that I needed to get the business expenses off my personal credit. It was time to take my banking to a business level, separate from my personal accounts.
When I realized something I was doing was hurting my credit score, I subscribed to one of the free credit-report services, and I started monitoring it and learning everything I could about the system. I had a dozen credit cards with balances ranging from $10,000 to $25,000 that the business was constantly maxing out, paying off, and maxing out again.
Thinking I was avoiding interest, I paid the balance in full but then charged it again, so credit reporting always showed a revolving balance that never diminished. Though I was paying my credit-card balances off each month, credit reports showed only that I was paying on time. It didn’t show that the balance was paid in full or only partially p
aid; it merely showed I paid. When you carry a balance over the reporting date, you look as if you’re always owing that amount and not able to pay your balance off, which drives your score down because your debt-to-available-credit ratio has to be a certain percentage.
From that point on, I didn’t want to let the banks tell me no. I have learned when the credit report is scheduled for each of my cards, and I take serious measures to ensure none of my cards have a high balance on them on that date. My credit score has soared since then, and I have learned to manage it and keep it high so I can always borrow money for my business and personal needs.
People used to believe cash is king, but the real truth is that cash flow is king because as long as you have cash funneling into your business and you have time to put that cash to work before a bill becomes due, you’re good, but when the cash flow dries up, you’re dead.
If I’m selling products and I’m making some money but not much, that money is moving into my world. I get to hold on to it and put it to work for a couple of weeks before it goes back out again, and that time can be vital for a small business. I have to play a sort of shuffling game in which I use the credit card to run the ad, and by the time I have to pay the credit-card bill, I’ll have made the money back on the sales from the ad. But if I run the credit card for the ad and don’t sell the product—perhaps because I didn’t follow my five tips for selling any product—then I won’t have the money to pay the bill when it becomes due. A lack of cash flow is like a whole pack of wolves that surround you quickly.
Administrative Wolves
Individually, administrative problems aren’t that scary, but collectively, they pack together like wolves snapping at an entrepreneur’s heels. They threaten to drain money, time, energy, and happiness.
1. Keeping Inventory Turning
As soon as you invest in inventory, you’re making the decision to lock up your cash. The only way to get that cash back is to sell the product—hopefully, for more than the price you paid. But you sometimes have to cut your losses and sell your products at a lower margin to have cash coming in and not just inventory sitting there.
Let’s say you paid two dollars for a particular product, and you want to sell it for five. You’ve run the ad for five, but you only got a handful of orders. Now the product’s just sitting there on the shelf, not selling for anything. It’s better to sell it at cost for two dollars and turn it back into cash that you can use again on a better idea than it is to tell yourself that if you sell it for two dollars you won’t make any money. It doesn’t make any difference. It’s sitting on your shelf, making nothing. It’s tying up the money you have in it. Liquidate it. Get that money and put it back in your business and give it a chance to grow through something else.
2. Touch It Once
Don’t put an item on a to-do list if you can get it done right away. Here’s an example. Ideas often hit me when I’m at a staff meeting, listening to reports, one-by-one. Sometimes, I write ideas down and come back to them after I have had time to consider them. However, if I know an idea is a great one, I immediately send an e-mail or a text to the people I want on the project. I save time by not revisiting the issue later, and e-mailing/texting gets the ball rolling faster. Remember money never sleeps. Every day—every hour—lost is time you could have realized a greater success.
3. Management by Walking Around (MBWA)
I’m a big believer in MBWA. I have had as few as three and as many as fifty-five employees, all in different divisions that I just pop into casually say, “Hey. How’s it going? What are you working on?” Their words might trigger something in my mind that I heard from somebody down the hall who’s working on a different project. That’s how you get collaboration going, find new ideas, and solve problems.
I may find someone processing a video when I walk in, and I’ll ask him what’s going on. He may tell me the process has been taking a while because his computer’s slow—it’s three years old. Here I am, paying this guy a big salary to produce product I can sell, but he’s got an aging computer that’s wasting hours of his productivity and delaying our sales. All he needs is a new computer.
Those are the kind of things you’ll never learn just by sitting behind a desk or in a project report meeting. The employee might never ask for a new computer, and you might never know he could be more productive if his computer were upgraded. You have to get up and walk around and talk to your employees on their turf. MBWA is one way to discover and fix inefficiencies as well as come up with winning ideas.
4. Make Your Meetings Matter
We used to have individual departmental meetings, but when we transitioned to weekly meetings where all departments came together, the camaraderie improved. Everyone knew everybody and began to see the big picture and to understand what each colleague was working on. And then ideas start to popcorn around. “Hey. I’m doing this. How might that work with what you’re doing?” I firmly believe in the importance of getting all the staff in one room on a routine basis every week. We went to monthly meetings for a while, but it was just too much to discuss, and the meetings got too lengthy. I have business associates who conduct shorter daily huddles. Regardless of how long your all-staff meetings are or how often you hold them, they create an opportunity for everyone in the room to talk, toss around ideas, get to understand each other, and know each other’s project list.
There’s been a backlash against meetings in the corporate world, with people groaning over “death by meetings,” and yes, it can certainly happen. But meetings also play a vital role because they foster collaboration and camaraderie.
At our meetings, I let everybody talk; it’s not just me handing down the word from on high. We’re not terribly structured. There is a little time for cutting up and enjoying a good laugh, but there’s also opportunity for everyone to hear what his or her fellow employees are working on and what the next phase is going to be. Somebody across the table might piggyback off something, and there’s a lot of give and take. Yet it does take discipline to ensure the meetings don’t run haphazardly, wasting hours of collective time.
On the one hand, if we present the agenda and request that everyone stick to it and we tell people when their scheduled time is up, everybody feels stifled and unable to provide input. The opposite is a free-for-all in which multiple conversations are taking place simultaneously and doodling is the most productive takeaway. Both of those extremes are unhelpful. Somewhere in the middle is the best. A good meeting should have an exchange of ideas, a general flow, and be calmly disciplined but also engaging.
The “No” Wolves
Winston Churchill once said never, never, never, give up. Books, mantras, movies, and even songs urge us to believe and achieve. The sentiment almost garners an eye roll in today’s cynical world.
Life is full of obstacles, and there are people who will tell you no. It’s one of the first words we hear as a child—often to protect us from danger. We learn to say it, especially as parents, almost without thinking.
As we get older, we must learn to graduate from no to yes. In business, we know to adhere to the no of not breaking laws or of being unethical. But the majority of the world is bent on saying no to you, to which most people will say okay and change their course around the wolf standing in the path, baring its teeth with a warning growl.
I often tell my team to never take no for an answer. It is when you figure out the way around a seemingly insurmountable problem, a harsh rejection, or a potential failure that you learn what true success feels like. Every problem has a solution. Brick walls can be climbed, chipped away, or driven straight through. Even the largest boar can be brought down with a small blade. Wolves can be calmed by the sound of the mandolin.
When my fifth child was a baby, I was invited to Cancun on a business trip with a group of other executives. The deal was to bring my wife to Cancun, stay in a really swanky hotel, and inspire each other over cockt
ails. I was really looking forward to it, obviously! So was my wife.
I got to the airport in Atlanta with my wife and my six-week-old baby girl, who was too young to leave behind. We’d arranged a sitter for the other kids. We were all set to fly first class to Cancun and go on this exotic trip. It was going to be wonderful. My wife was excited. I was excited. Then the ticket agent asked to see the baby’s passport.
We looked at each other in shock. I had completely overlooked that the baby would need a passport to travel. My wife’s face fell. “I’m just going to take the baby and go home. You can go without me.” She was crying.
I said, “Oh, no you’re not. We’re going to go on this trip. I am going to find a way to go on this trip.” I asked the ticket agent if I could use a birth certificate.
She looked as if she felt sorry for me but said no.
I said, “How long does it take to get a passport? Can I get a passport today?”
“It takes a long time, but there is a place that does rush passports and can turn them around in a week.” This trip was an opportunity that wouldn’t wait a week for a passport!
I told Jan, “You are not going home. You just stay right here with the baby.” I got on the phone with the State Department and learned there are only five cities in the USA where you can get a same-day passport: Atlanta, Los Angeles, New York, Chicago, and Houston. Obviously, I tried Atlanta first, but Atlanta appointments were booked for days in advance. Then I thought, Well, heck, Houston is on the way to Cancun. Sure enough, I got an appointment for 9:00 a.m. the next day in Houston to get a same-day passport.
We redirected our flight to stop in Houston. With just hours to spare before departure—again—we raced home and got all the materials: birth certificate, photos—everything. We got to Houston just in time for our twenty-minute slot, and I got my little girl a same-day passport. We were all on the next flight to Cancun and only missed one day of that special trip.
The Wolves and the Mandolin: Celebrating Life's Privileges In A Harsh World Page 10