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(Some Guy)   10 mistakes made by the newly self-employed   ( divider line
    More: Interesting  
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56502 clicks; posted to Main » on 11 Apr 2006 at 8:49 PM (11 years ago)   |   Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»

126 Comments     (+0 »)

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2006-04-11 07:51:57 PM  
On a business related note, I was on a flight the other day, and I saw this guy next to me was typing an email, so, having nothing better to do, I peeked over to read a bit (yeah yeah privacy, blah blah suck it). Anyhow, all it was was this long rambling thing about how they need to reprioritize their
actionables and roll out their opportunity assesment process and blah blah blah and the whole thing amounted to: "This looks like it could be cool, let's check it out". It was then that I decided corporate america must die. The end.
2006-04-11 07:55:52 PM  
11) Billing for "wank breaks."
2006-04-11 08:12:31 PM  
I like how, at the very end, he has the donation link.
2006-04-11 08:16:10 PM  
11. Hiring an idiot like yourself.

12. Working for an idiot like yourself.
2006-04-11 08:54:16 PM  
2006-04-11 08:54:22 PM  
11: Get a decent web server that can stand more than 400 visits in a day.
2006-04-11 08:55:42 PM  
From now on, let's focus on submitting websites that aren't owned within 5 minutes of being greenlit.

2006-04-11 08:56:13 PM  
12) Copy something that's been in the popular queue for days.
2006-04-11 08:56:54 PM  
step 1) be a small businessman
step 2) post a story to fark that includes (presumably, didn't actually click them) links to your and your wives small businesses
step 3) profit
2006-04-11 08:56:59 PM  
11. Spend all day on Fark.

2006-04-11 08:57:03 PM  
TallAsFark: 11: Get a decent web server that can stand more than 400 visits in a day.

This link is on the top of,,, newsvine and every other huge ass site today.

BTW this guy is nuts. He doesn't sleep. He finished college in 3 semesters (double major in CS and math) and can do a chun li super move! He is currently training for the worlds strongest man competition as well.
2006-04-11 08:58:56 PM  

11) Making a proposition to an undercover cop for sex at $20 a pop.

Oh, sorry, that's from the list of, "10 mistakes made by the newly self employed prostitute freed from her pimp."

2006-04-11 09:00:28 PM  
I like to work at nothing all day.
2006-04-11 09:00:30 PM  
11) Your boss catching you watching porn.
2006-04-11 09:02:15 PM  
many) Submit interesting links.

/bad submitter
//no steak for you
///Your dog gets some though
2006-04-11 09:02:26 PM  
that article leaves me thinking it is just a load of shiate.

It is just a tad trite.

/experienced business owner.
2006-04-11 09:02:42 PM  
Anyone have a cached copy to post of the top 10? site seems bogged down...
2006-04-11 09:03:36 PM  
22) Never videoconference with clients

/if you're self-employed, you know why
2006-04-11 09:05:14 PM  
Forgetting to turn off the webcam after you are done
2006-04-11 09:05:30 PM  
And if you manage to avoid all of these missteps you can be where I am today: begging
If you find this article helpful, please leave a donation for the writer.
2006-04-11 09:06:54 PM  
X6) Choosing a website that is farked after less than 3,000 hits.

/srsly, site's farked now.
2006-04-11 09:08:34 PM  
Graduation Dog: everyone begs, it's just a matter of the degree.
2006-04-11 09:09:29 PM  
I work for myself so I'm really getting a kick out of that top 10 list...

Lotta duh! in there, and a lot of crap, but Ric Romero still has a job, so...

and WTF is Failing to Optimize? 576 words and I still have no idea.

11.) Soliciting for donations on the internet.
Nothing says "I'm a competent professional" more than begging for money.
2006-04-11 09:11:06 PM  
Here they are:

1. Selling to the wrong people.
2. Spending too much money.
3. Spending too little money.
4. Putting on a fake front.
5. Assuming a signed contract will be honored.
6. Going against your intuition.
7. Being too formal.
8. Sacrificing your personality quirks.
9. Failing to focus on value creation.
10. Failing to optimize.
2006-04-11 09:11:09 PM  
Graduation Dog Yeah, the rest of us are just begging for jobs we're going to hate.
2006-04-11 09:13:45 PM  
12. Operate a POS webserver that gets farked.
2006-04-11 09:14:12 PM  
2006-04-11 09:15:09 PM  
Real self employment tips:

Have one phone for work and another for everything else. Never give out your personal number to anyone work related.

Never answer your work phone when you are not officially "at work".

As a rule, never let clients know where you live. The sane ones would never bother you at home etc., the crazy ones will do it every time.

If you get the feeling a potential client has "issues" either refuse to do the job or charge them double-triple.

The only downside of being self employed is sporadic income and the occassional idiot.
2006-04-11 09:15:16 PM  
A dump for those who can't get in:
10 Stupid Mistakes Made by the Newly Self-Employed
April 10th, 2006 by Steve Pavlina

Having been a non-employee for about 14 years now, Ive made my share of stupid business mistakes. Ive also coached a number of people to start their own businesses, and Ive seen many of them make similar mistakes. This advice is geared towards small business owners, particularly people who are just starting (or about to start) their own business.

1. Selling to the wrong people.

While sales are important to the survival of any business, you dont need to push your business on everyone you meet, including friends and family. Furthermore, its a waste of time to try selling to people who simply dont need what youre offering.

Selling to the wrong people includes trying to sell to everyone. Some customers are much easier to sell to than others. For example, my wife does web consulting for small businesses, and shes learned that some clients are much harder to work with than others. If a potential customer is broke and obsessively worried about every nickel they spend, if they want a web site but dont know why, or if they simply dont understand the Internet well enough, they wont be a good client in the long run. Feel free to say no to customers that are more trouble than theyre worth. Let your competitors sell to them instead. Youll save yourself many headaches, and youll free up more time to focus on serving the best customers.

Just because someone is interested in doing business with you doesnt mean you should accept. In my first year in business, I probably said yes to at least 50% of the people who approached me with a potential business relationship. I wasted a lot of time pursuing deals that were too much of a stretch to begin with. I accepted lunch invitations from random business people who just wanted to see if theres a way we could do something together. Virtually none of them made me a dime. If you think a meeting is pointless, it probably is. Dont network with random people just because you think youre supposed to network. Today I accept such invitations less than 1/10 as often. If an offer doesnt excite me right away, I usually decline or ignore it. Most relationships simply arent worth pursuing. Learn to say no to the weak opportunities so you have the capacity to say yes to the golden opportunities.

2. Spending too much money.

Until you have a steady cashflow coming in, dont spend your precious start-up cash unless its absolutely necessary. I started my computer games business with about $20,000 cash (my own money), and it went fast; shortly thereafter I was using debt to finance the business. Unfortunately, the original business model didnt work, and it took five years before the business was generating a positive cashflow. I soon learned that every dollar invested in the business was another dollar that eventually had to be recouped from sales.

In 2004 I started this personal development business with only $9 cash even though I could have spent much more on it. No fancy logo, no snazzy web design, no business cards or stationary. I paid to register the domain name, and that was it. Thats as much as I was willing to spend before I started generating a positive cashflow. All other business expenditures came out of that cashflow.

Your business should put cash into your pocket, so before you invest money into it, be clear on how youre going to pull that cash back out again.

Obviously some businesses require lots of cash to start, but in the age of the Internet business, you can very easily start a lucrative business for pocket change.

3. Spending too little money.

Its also a mistake to be too stingy with your cash. Dont let frugality get in the way of efficiency. Take advantage of skilled contractors who can do certain tasks more efficiently than you can. Buy decent equipment when its clear youll get your moneys worth. You dont have to overspend on fancy furniture, but get functional furniture that helps you be more productive. Dont use an antiquated computer with outdated software that slows you down if you can afford something better.

It takes time to develop the wisdom to know when youre being too tight or too loose with your cash, so if youre just starting out, get a second opinion. Often the very thought of getting a second opinion makes the correct choice clear. If you cant justify the expenditure to someone you respect, its probably a mistake. On the other hand, there are situations where its hard to justify not spending the cash.

4. Putting on a fake front.

Many one-person businesses refer to themselves as we. Thats something a lot of new entrepreneurs do, but it isnt necessary. Theres nothing wrong with a one-person business, especially today. My games business has mostly been a we over the years, but my personal development business is still an I. My wifes VegFamily Magazine business is a we, since she has a staff working for her, but her web consulting business is an I. Its perfectly OK to refer to your business as an I when youre the only one working in it. Pretending that youre a we when youre really an I is a bit silly. Its not going to gain you any respect in a way that matters. Promoting yourself as an I may even be an advantage today, since people will know the buck stops with you, and if you make a promise, youre the one who will carry it out. Promises from a we sometimes arent worth very much.

If youre a newly self-employed person, dont pretend youre anything else. Price your products and services fairly for your level of skills and talents. Some newly self-employed people think they must become actors. The business they promote to the world is pure fantasy. Trying to fool your customers in this manner will only backfire. If youre so desperate for business that you need to lie, you shouldnt be starting your own business. If you cant provide real value and charge fairly for it, dont play the game of business. Develop your skills a bit more first.

5. Assuming a signed contract will be honored.

Ive made this mistake more than I care to admit. Ive had signed contracts with supposedly reputable corporations, and they werent worth squat when the CEO decided he wanted out of the deal, even for completely dishonorable reasons. Sure I was in the right, but did I want to go to court to enforce it? No, Id rather continue doing meaningful work.

A signed contract is just a piece of paper. Whats behind a signed contract is a relationship. If the relationship goes sour, the contract wont save you. The purpose of a contract is to clearly define everyones roles and commitments. But its the relationship, not the paper, that ultimately enforces those commitments. When I understood this, I focused more on relationships and worried less about what was on paper, and my business deals went much more smoothly. Once you start falling back on the paper, the deal is already in trouble. Creative (and lucrative) business deals almost always stray from the paper contracts that represent them. One of my attorneys, who had worked on dozens of game development deals, told me that no deal he worked on ever followed the contract exactly; most werent even close. And these were big money deals in many cases. Business relationships are similar to other personal relationships they twist and turn all over the place.

Written contracts are still necessary, especially when dealing with larger corporations where people come and go, but theyre secondary to relationships. Just dont make the mistake of assuming that the contract is the deal. The contract is only the deals shadow. The real deal is the relationship. Keep your business relationships in good order, and you wont have to worry so much about whats on paper.

Its sad but true that there are loads of scoundrels in business. Many of them hold titles like CEO, President, and CFO. There are indeed people out there who seem to care about nothing but money, and they will lie, cheat, and steal to get it. In recent years some of the more despicable ones have gotten themselves indicted (or are already behind bars). But there are plenty of others to whom the word honor has no meaning. For example, in the computer gaming industry, it isnt unusual for large publishers to feign interest in certain games and string the developers along. They give the developer every indication that a deal is pending, but all the developer sees are delays and false verbal promises. In reality the publisher only wants to keep the game off the market to keep it from competing with one of their own titles; they hope to cause the developer to miss the next Christmas season or to run out of cash and cancel the title altogether. It happens. Business, especially the entertainment industry, is not for the timid.

6. Going against your intuition.

Intuition is just as important in business as it is in other settings. Youd be amazed at how many gigantic corporate deals are green-lighted or red-lighted because of some CEOs gut feeling. While you might think that logic is the language of business, thats far from reality. If you base all your business deals on hard logic and ignore your intuition, most likely youll be in for a world of hurt.

We humans arent very logical to begin with. We simply dont have enough data to make truly logical decisions because business deals depend on human beings, and we dont have a logical system for accurately predicting human behavior. Not being able to predict how other humans will behave is a pretty big gap in our logic. And intuition has to fill that gap. The real performance of human beings is what makes or breaks business deals. But to assume everyone will perform as expected is unrealistic in the extreme. No deal ever goes perfectly.

Its hard to say no to a deal that seems juicy by the numbers when my gut is saying, Youll regret it, but more often than not, I later see evidence my intuition was right all along. Sometimes I just get a bad read on someone, and then years later, several people I know are complaining about being ripped off by that person.

Intuition is a critical part of the decision-making process in business. Since business deals depend on relationships, you need to get a read on the other people involved in any deal you consider. If you get a bad read, walk away. If you get a good read, proceed with caution.

7. Being too formal.

Ill say it again. Business is built on relationships. In some settings a certain degree of formality is appropriate, but in most business situations being too formal only gets in the way. Business relationships work best when theres a decent human-to-human connection behind them.

I think its a mistake to be too formal even when looking to establish new business relationships. If someone mails me a letter that starts with Dear Mr. Pavlina and then goes on to explain a long-winded business proposal, Ill usually just trash it, especially if it uses the word we a lot. Better to fire off an email with a Hi Steve, and just ask me very informally if Im interested in the kind of arrangement youre seeking. It saves time and opens the door to a real human relationship. Human beings dont want to build relationships with faceless corporations. They only want relationships with other human beings sometimes animals too I suppose.

Treat your business relationships like friendships (or potential friendships). Formality puts up walls, and walls dont foster good business relationships. No one is loyal to a wall except the one in China.

Formality is boring and tedious. People want to enjoy their work. If someone address me like a computer, Ill respond in kind by hitting delete. But if someone demonstrates they have a real personality and a good sense of humor, a connection is far more likely.

8. Sacrificing your personality quirks.

In the early years of running my games business, I took myself too seriously and assumed that I had to act businesslike whatever that meant. Being self-employed was a weighty responsibility, and other people were counting on me. Sink or swim, right?

I started my games business in my early 20s, and people in their early 20s are invariably weird. But I assumed that as a business owner, being weird wasnt appropriate or acceptable. So most of my business letters and emails looked like they were written by the same people who created Microsofts EULAs. The job title of President really went to my head. I learned how to function without a personality.

It took a number of years, but eventually I became comfortable just being myself, especially after my games business became profitable. Now that Im a blogger, my personality quirks and unusual experiences are strengths. My personal oddities give this blog a unique flavor. If I were to take myself too seriously and write more formally, this blog would be very dull and would likely lose much of its audience.

Its perfectly OK to be your own weird self and to inject your own unique spirit into your business, especially if youre in your teens or 20s. Dont be afraid to be more like Steve Jobs and less like Steve Ballmer. Dont pretend to be something youre not. Ultimately youll enjoy your work much more if you attract the kinds of customers and partners that want to work with you for who you are warts and all. Send the people who only want to work with androids to your corporate competitors. They deserve each other. :)

If other people cant handle your weirdness, too bad for them. Focus your energy on the people who can.

9. Failing to focus on value creation.

Its easy to fall into the trap of thinking that the purpose of a business is to make money. But the real purpose of a business is to create value. While its possible to make money in the short run without creating much value, in the long run its unsustainable. Even criminal organizations have to create value for someone. When you know your business is just sucking value away from others without providing anything in return, it will erode your self-esteem, and the business wont be much fun to run.

Why does your business exist? It exists to provide some sort of value, both for you and your customers. The better you understand what value youre trying to provide, the better youll be able to focus. The basic value provided by my games business was cerebral entertainment. The basic value provided by is personal growth. Too often business owners arent clear on what value theyre trying to provide. They just sell stuff and hope for the best. Thats a lousy business model. The world doesnt need more selling or more stuff. But it always needs and wants genuine value creation, and thats where you should direct your efforts.

Presently this web site contains over 400 free articles. Thats a lot of value creation. Thousands of people visit each day to receive some of that value. Helping people grow is the business primary aim.

10. Failing to optimize.

Although value creation is essential to a sustainable business, its equally naive to assume you can simply focus on creating value, and the rest will take care of itself. You may build a business that provides good value but loses money. As a business owner, you need to find a way to deliver your value in a cost effective manner. Most likely your first attempt will be very suboptimal. Youll waste too much time, money, and resources trying to produce and deliver your value. Thats OK though. Many businesses start out that way. Just dont let yours stay that way.

Once you have a particular business process in place, pull it apart and re-optimize it from time to time. Look for ways to make it more efficient. Can you get it done in less time? At less cost? Can you do it less frequently? Can you outsource it? Can you dump the process altogether?

I used to process credit orders for my games business manually. I started the business in 1994, and when Id receive an order through the mail or via my web site, Id use some software to input and run the orders by modem. At the end of each month, Id manually tally the sales. That worked fine when sales were low, but it became burdensome as more products were released and sales increased. Several years ago I upgraded the process such that online orders were fully automated, including instant delivery of the game download. All orders are recorded in a database, and I can view real-time reports to see how sales are doing for each product. It took some work to set this up, but it was well worth it. That one optimization saved me a lot of time and effort, and I dont have to pay high fees for a third-party order processing service.

Dont fall into the trap of using archaic methods for doing routine tasks that could be automated, including inventory management, billing, accounting, order processing, communications, and marketing. If you find yourself doing the same repetitive tasks month after month, make sure you put some effort into optimizing them. Not optimizing is like throwing time and money down the drain. Its often much easier to save time and money than it is to create them.

An Internet business has abundant opportunities for optimization because its so easy to try new things and measure the results. In the first year after launching this site, I experimented quite a bit with Google Adsense. Many people dont like the ad layout on this site, but its the most effective layout Ive tried so far. I use it because it works. Adding the donations page was another optimization. Some people click ads, some people donate, and some do both. So even though value creation is the primary aim of the business, this is still a for-profit business and needs to generate income in order to be sustainable. If I dont eat, I dont write. More money means more resources for ongoing value creation. So value creation and optimization go hand-in-hand.

It takes significant effort to build a successful business, but its also a tremendous growth experience. I know many people who have quit their jobs to run their own businesses. Many of them didnt do as well as theyd hoped, but I dont know any that regretted taking the plunge. Theres simply no substitue for holding the reins of your own destiny.
2006-04-11 09:15:34 PM  
11. Farking the help.
2006-04-11 09:19:36 PM  
Masturbate furriously during video conferences?
2006-04-11 09:20:07 PM  
/google adsense for teh win!
2006-04-11 09:21:57 PM  
What games did he design?

/too lazy to look for self
2006-04-11 09:24:11 PM  
I work for myself so I'm really getting a kick out of that top 10 list...

Oooh. Nicely done.
2006-04-11 09:24:29 PM  
Masturbate furriously during video conferences?

I find that slow and steady is far less offensive to my clients.
2006-04-11 09:24:35 PM  
I did small business consulting a while back. The biggest things for a new small business are, (not necessarily in this order)

1) Location, location, location. Yep, they are right.
2) If what you sell is cheap, you must sell a gawdaful lot of it. If it is expensive, you only need to sell a few a month. But in either case, you must sell it.
3) Get a friend who is convinced that everything you are doing is a bad idea. And who is smart enough to say why.
4) Profit is not JUST how much money you make, it is also how much money you SPEND. Pay slightly more attention to money going out than money coming in.
5) Don't open a restaurant. Almost all new restaurants fail.
6) SBA loans are an incredible assist, get them.
7) Never, ever, ever co-mingle funds.
8) Chart your progress. Data will tell you the future better than your feelings.
9) Rental property can suck you dry. Plan to get into a building you own ASAP. A mortgage is usually better than rent, at least you get equity.
10) Buy only the technology you need now. Computers can do amazing things, mostly wasting your time and money.
11) Sell multiple, different products or services. After a while, only sell the most profitable, and ditch the others. Then get new unrelated products and try to sell them, too. Over time, you'll end up selling only things your customers want.
12) Do not reinforce the innumerable small defeats you will face. Always have backup plans 'b', 'c', 'd', and 'x', and the resources to support them.
13) Learn every single law that applies to your business.
14) Learn about all the crime in your neighborhood.
15) Assume a minimum of three years before you have your first dime of tangible profit.
16) Have an exit plan, so that even if your business folds, you won't be hung out to dry, lose all your stuff, and face endless creditors, criminal filings and litigation.
2006-04-11 09:25:00 PM  
bah! it's all just a bunch of common sense wrapped up in jargon. be concious of how far your dollar can go, be yourself, and keep your wits about you would have been better advice in 1/500th the words.

/farkers, you're my only co-workers
2006-04-11 09:26:10 PM  
11) going on strike
12) stealing from the company
13) Have an office romance
14) Having conference calls
15) Quitting, coming back and shooting up the place
2006-04-11 09:26:10 PM  

We have a WINNAR!

Oh, and Number 5 - You bet your ass I sue people that don't pay me and don't honor their word/ contract. Teaches them a farking lesson that their mother should have!
2006-04-11 09:33:02 PM  

Bravo. Your list is 100% more accurate than the shiate that got greenlighted. You should repost the entire thing in bold so people will read it and forget that other crap.

I found myself reading your list and thinking, "yes to that, yes, absolutely," etc. etc.

Another good one would be, "If you're starting your own business because you don't like dealing with customers, you're fooling yourself. No matter what the business, you'll need to exercise customer service."
2006-04-11 09:34:09 PM  
Been self employed myself for 10 years and it is pretty sound advice despite the fark critics.

#11 should be get your self a decent accountant and financial advisor.
#12 should be get incorporated if you live in Canada.

/then put #11 to #1
2006-04-11 09:34:21 PM  
Oh puh-leeze. I have been a self employed entrepreneur for years and a freelance designer for more than that. The guy is really full of Romero. Oh, and begging for donations and saying you can start an money generating internet business for $9 ($9? What are you doing/selling, dickhole? Are you writing from the year 1999 before the dot com bust?) is really being both a tad pompous and irresponsible.

/end rant
2006-04-11 09:35:48 PM  
This guy is a moron. It's a f*cking link farm.

What has this moron accomplished in his life? His games site looks like it's made by a 5 year old moron.

What "businesses" does he run?
2006-04-11 09:36:55 PM  

and WTF is Failing to Optimize? 576 words and I still have no idea.

So I am a corporate whore, but I have written made scripts that "optimize" my tasks; group together the necessary information, wrap them around the actions that need to be taken, and processes that used to take an hour or two now can get slammed out in 15 minutes (less if my fingers are flying).

Another part of optimizing, is DELEGATING the work; sure, I could do everything everyone asks me, or I could delegate it down to my team. Its knowing when something requires the magic touch and when it doesn't.
2006-04-11 09:37:31 PM  
The mistake I see most often is charging too little.

You see guys trying to resell stuff for a 5% markup or bidding on work where they would end up making $10/hr even if things went smoothly.

They end up making $1/hr or losing money.
2006-04-11 09:38:08 PM  
11. do not use business advice you find on an internet page that has a donation button.
2006-04-11 09:38:48 PM  

that sounds good
2006-04-11 09:40:03 PM  
clgrin Wins the thread.
2006-04-11 09:40:22 PM  
better to just work for the man or a major company and suck it up and bend over
2006-04-11 09:43:09 PM  
Usual dumb biz advice

This thread is useless without...?
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