My Side Hustle: How I made $25,000 per month in less than 6 months
It is in changing that things find purpose.
Heraclitus 535-475 BC
My goal was to make $10,000 USD, which would be $15,800 CAD a month. I would do it by starting a Yellow Pages-style online directory. I could only devote an hour or two a day at most and four hours on the weekends. I quickly determined that since I could not invest very much time and hardly any money, I had to scope my Yellow Pages idea down to one category. Back then we had big, physical Yellow Pages (businesses by categories) and White Pages (people) address and phone books. They may be antiques by now.
So what category would I select? What would the Internet be unique for that I would also enjoy learning about myself? I knew I would need to build a website and find a web host. I was struggling to find a low-cost and easy-to-use web hosting company to host my directory. I believed that eventually, every business would need a website and a web host, like me. In my own search, I was missing reviews and ratings on web hosting companies. Eureka! This is what I would create.
What will I name my directory?
Tigers die and leave their skins; people die and leave their names.
Japanese Proverb
What you name, you breathe life into. You conceive your new venture, idea or product with a name. This name has some meaning, or better yet, a story.
I believed the Internet would be global. So I found an available domain, HostGlobal.com. I would later need a formal company but I would incorporate it after I made some money. Naming would later become one of my great gifts.
My Entrepreneurial Blueprint
You were born to win, but to be a winner, you must plan to win, prepare to win, and expect to win.
Zig Ziglar
Start date: Jan 1, 1999.
Name: HostGlobal.com (registered on Jan 10, 1999).
Financial target: $10,000 USD/month by Jun 30, 1999.
Idea: Create a Yahoo-like directory but for web-hosting companies
Plan:
Find software that allowed me to build a directory (1 week).
Add 20 Webhosting companies per day to my directory (daily).
Build and add a review and rating module to the software (4 weeks).
Offer the review module to users of the software in return for adding their web hosting company with a review and rating. This would:
Differentiate my web hosting review site from the handful of other ones (my secret edge).
Attract entrepreneurs and companies looking to find a web host for their Internet business.
Sell sponsorship packages to the web hosting companies (1-2 months). 300 companies at $30/mo = $9,000 USD/mo.
Incorporate in Nevada to have a U.S presence (2 months).
Adapt to users, web hosts and competition.
Ask, Tweak and Receive. 10x. 100x. 1000x
The best-laid plans of mice and men often go awry.
— Robert Burns
I learned the programming language PERL as that was what the directory software was written in. I had never taken a computer course before so I printed out some lessons on PERL from the Internet and studied them in my allotted side job time. I created the review module within a month and kept improving it daily until it worked well.
I then offered the hundreds of web hosting companies on hostglobal.com an unbelievably low-cost sponsorship opportunity of $30/month. I waited for the orders to come in. I waited … and waited for days. I wondered what was wrong.
A couple of other good web hosting directories were charging $1500 to $3000 per month. I thought that underpricing them would be a no-brainer. Was it too cheap? Maybe the perceived value was too low.
So, I thought I would try $300/month for category sponsorship. In a month I had two sponsors. 10X! I had made my first real dollars. What a thrill. That first order!
Then I had a brilliant idea. I thought I would try $3000 for sitewide sponsorship. 100X! I got one. A big fish.
Then I thought I would offer one $30,000 title sponsorship spot. 1000X!
So, when Communitech, a Kansas City web hosting company, was interested, I asked them for $30,000 and they said No. Then I thought “OK, but what if I could get $20,000?” Wow! $20,000/month!? I countered with $20,000 plus a dedicated web server so I could then move into dedicated server listings. They agreed and just like that I surpassed my goal in under 6 months!
Life Advice Now
To my 29-year-old self:
If you plan on being anything less than you are capable of being, you will probably be unhappy all the days of your life.
— Abraham MAslow
I believe in you.
You believed in yourself even when you didn’t have the ability or experience to do it. You impress me. You had a big drive to figure this out and you executed. Despite all the self-doubt. That drive and determination is almost unstoppable.
Continue to learn
Evaluate whether that skill is something you want to continue for the rest of your life or only do for a season or a reason.
I wish that I continued to program and learn new languages to this day.
Talk to your competitors and make them frenemies.
You only looked at your competitors’ websites. You should have had meetings with them to see if there were any things you could collaborate on as there were only a few other big competitors.
Some of my dear friends now were my fiercest competitors. Scott Day, the watermelon farmer and Frank Schilling, the wonder boy. Yun Ye, who sold his business to Marchex for $164 million.
Talk much more to your customers.
You were only scratching the surface. You could have uncovered the deep needs of web hosting companies and their customers. Think how that space has evolved to Shopify, Squarespace and Wordpress.
Continue to keep plans simple
I have plans that are too complex, too dependent on too many people and outside factors. Focus on what you can do and control and then partner with people who can fulfill other parts of your plan.
Next week:
How to Find Hidden Opportunities in Plain Sight.
Giving birth to a whole new world of opportunities.
See you next Thursday!
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