Flowchart: Should You Work For Free?

Here’s a decision chart that’ll amuse those of you who work independently, perform some freelancing/consulting work, or just happen to be especially good at something. Should you do the work for free? Well, it depends:

(click to visit site)

By Jessica Hische at ShouldIWorkForFree.com.

Two Completely Different Ways to Boost Productivity

While procrastinating today, I of course ran across a couple of tips on productivity and success that both powerful and very different.

First is an essay called Good and Bad Procrastination by Paul Graham. It includes a lot of insights into procrastination, and my favorite was the idea that it was okay to put off less important, scheduled, to-do list-type things whenever you get a chance to focus and do some really great things:

The reason it pays to put off even those errands is that real work needs two things errands don’t: big chunks of time, and the right mood. If you get inspired by some project, it can be a net win to blow off everything you were supposed to do for the next few days to work on it. Yes, those errands may cost you more time when you finally get around to them. But if you get a lot done during those few days, you will be net more productive.

In fact, it may not be a difference in degree, but a difference in kind. There may be types of work that can only be done in long, uninterrupted stretches, when inspiration hits, rather than dutifully in scheduled little slices. Empirically it seems to be so. When I think of the people I know who’ve done great things, I don’t imagine them dutifully crossing items off to-do lists. I imagine them sneaking off to work on some new idea.

The second is the Jerry Seinfeld Productivity Secret by Brad Isaac:

He told me to get a big wall calendar that has a whole year on one page and hang it on a prominent wall. The next step was to get a big red magic marker.

He said for each day that I do my task of writing, I get to put a big red X over that day. “After a few days you’ll have a chain. Just keep at it and the chain will grow longer every day. You’ll like seeing that chain, especially when you get a few weeks under your belt. Your only job next is to not break the chain.”

“Don’t break the chain,” he said again for emphasis.

This idea of incremental change is not new – see this post on Kaizen for example.

Some things are best achieved when you attack it a little every day – things like debt reduction, learning a language, or weight loss. Other things you may have to wait for the inspiration, but when it comes, it pays to put it above all else. Perhaps a great business idea or investment opportunity.

The E-Myth Revisited: Small Business Book Review

I bought The E-Myth Revisited: Why Most Small Businesses Don’t Work and What to Do About It by Michael Gerber at a outdoor market because it was a finance “bestseller” and I’d seen it on a few reading lists. It’s been sitting on my bookshelf since (along with many others…), but once I picked it up and read a chapter, I went ahead and finished over the next two days.

Why Businesses Fail

The “E-Myth” stands for the Entrepreneurial Myth, which I’ll paraphrase as the belief that all a successful business needs is a hardworking, skilled, fearless entrepreneur. When we think successful small business, we think of Bill Gates or Richard Branson of Virgin. Is it really that simple? 40% of small business fail within one year. 80% of them fail within 5 years.

This book states that, in reality, a successful business needs three roles to be fulfilled:

  • a technician which understands the technical aspects of the business,
  • a manager which plans and organizes, and
  • a entrepreneur who provides the vision and energy.

You might think you have all of these characteristics already, but these roles are often in conflict with each other. Most businesses start out with only one role really filled – that of the technician. A plumber starts a plumbing company. A baker starts a bakery. A graphic designer starts a design shop. Usually, the motivation is that they don’t want a boss. The end up have a poorly trained boss – themselves.

When things get hard, usually the technician wins out. The perceived solution is to work harder, do everything by yourself, so that you can “do it right”. This is where many businesses start to fail. Now, if you’re really stubborn and hardworking, you can make this stretch out for a long time. You’ll also be really tired and unhappy.

I actually see this first part of the book as separate from the next part. It teaches you to look at how you are running your businesses. Are some of the roles being too strong, or being neglected? The manager tends to micromanage, and the entrepreneur tends to be the frustrated dreamer.

The Solution

Okay, so now what? How do you take your business to the next level?

Gerber says to look at the franchise model, and uses McDonald’s as an example. Don’t focus on the fact that you may hate the food there. The true power of McDonald’s is that every single aspect of the business was broken down step-by-step and laid out that a random person off the street could “read the manual” and open up their own McDonald’s restaurant. Where to locate the restaurant. The layout of the kitchen. The menu. How each hamburger is ordered, stored, cooked, assembled, and finally delivered to the customer.

What’s your system? If you were to train a reasonably smart person without any knowledge in your field, how would you break down your business to them? What is the unique value proposition that you offer, and how do you achieve it? What does each roleplayer do? As the saying goes, “Explain it to me like I’m a 10-year old.”


I view this book as “big picture” type of book that will definitely get you thinking differently about your business and business goals. Since it is also relatively short and easy to read, I would recommend it to anyone who wants to work in a small business, or is already working in one. (It’s also really easy to find at the library or used for cheap – try Amazon or Half.com.)

The book is definitely more applicable to a small business where you plan on one day being more “hands off”, like a restaurant, a store selling widgets, or a big design agency. But even for the many people out there who are perfectly happy being a one-person show, you can still apply the concepts of this book. You can break yourself down into what your special roles or tasks are. Write it down. You may not have ever thought of yourself in this way. Then you can focus on those areas, and either get rid of or outsource the tasks that you don’t need.

Now, some critics will call this book common sense from a self-appointed guru. In this way, I feel this book is a bit similar to Rich Dad, Poor Dad by Robert Kiyosaki. I didn’t really like the rest of his books, but the idea that you should buy assets that grow instead of liabilities like cars or gadgets can be helpful. But reading it was definitely a net positive for me, as was reading The E-Myth Revisited. Both are not the best writers out there, but still manage to convey their message.

Developing and Monetizing a Niche Website

The following is a guest post from reader Dan, who shares his story of starting Maciverse.com and developing it to where it earns $1,500 in passive income each month.

In January of 2008 I closed shop on my first attempt at blogging. Six months earlier I thought that creating a blog about efforts to train for my first marathon would be extremely successful. It didn’t take me long to realize that the only thing more boring than writing about running is reading about someone Else’s runs. When I shut the doors on 26miles385yards.com I wasn’t giving up on blogging, I was giving up my blogging about topics that no one wanted to read.

It was also in January of 2008 that I launched Maciverse.com, a Mac Help blog. I’ll admit that I was late to market with the whole Apple blogging idea but I believed I had a bit of a different take on Apple computers and felt that I could fill a niche.

It was 6 months after Apple released their first iPhone and there was significant talk from media outlets and financial advisers about how they were anticipating a significant “halo” affect from iPhone and iPod sales into Mac computers. The more I heard this idea, the more I realized that there would be a growing audience of individuals looking for help with use of their new computer. Just a few years earlier I purchased my first Apple computer and had quickly fallen in love with the products the company built. There was a learning curve but I was picking up use of the Mac quickly and found myself sharing tips with even the most experienced Apple product owners. So I decided to create Maciverse as a site where I shared my tips to the new Mac user.

Maciverse didn’t explode overnight, but through steady and consistent effort the site has grown from just a handful of visitors each month to over 1 million visitors each year It continues to increase in size by about 20% each month without a single dollar spent on advertising. We now cover more than just hints and tips for your Mac and have grown to a team of 5 authors sharing everything the know, love, and sometimes hate about Apple products.

With the traffic growth has also come residual income. but in reality, for the first year Maciverse didn’t make more than $100. My first check from Google Adsense came in year 2 and at that time I was just happy to be breaking even. But over the last 12 months Maciverse has gone from making just a few dollars a month to continual earnings of over $1500 a month. Increasing the number of visitors to the site has helped with the financial gains, but the biggest reason I wasn’t always making decent income from Maciverse was because I didn’t know how to monetize my audience. Below is what I’ve learned about monetizing a Mac site.

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Starting a Home Based Business: Stay at Home Mom Upgrades Volunteer Work into New Start-Up Business

The following is a guest post from reader Leslie, who shares her story of returning to the workforce by starting her own business in Florida. You can see more of her work at on Facebook and soon at LALGraphicDesigns.com (currently under construction).


As a thirty-five year old mother of three, for the past decade I have been fully employed as a stay at home mom. When my first child was born I put my career aspirations and four year college degree aside to focus on raising our children. Before motherhood, I used to work as a graphic artist doing on-air graphics for a local TV station and a national satellite TV provider. Now that all the kids are all in school, with encouragement from friends and family, I recently started my own home based graphic art and design business. This is the story – or at least the first chapter – in a story which just began to be written about my home based business.

After “retiring” to run our household, I kept my artistic and computer skills fresh over the past several years by volunteering and providing free graphic arts services for community organizations, schools, friends and family. Samples of school T-shirt and business logo designs are copied in the margins. Although I committed my energies to raising our children, I had always wanted to run my own business. As set forth below, my contacts through our local parent teacher associations and charities have developed into business clients.

Formation and Formalities

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Entrepreneur Group Interview: Etsy.com Shop Sellers

A couple weeks ago, I was looking to interview a reader who sells on the handmade online marketplace, Etsy.com. I was surprised to get over 30 inquiries, and so I made up a short questionnaire to help better understand what it’s like to sell goods on the site. 16 shopowners responded, with folks selling everything from soap to jewelry to vintage fabric.

Here are my questions and a compilation of all their responses.

How did you get started with Etsy? When?
There was a wide range of dates given, the earliest being April 2006 and the most recent being September 2009 (The site first launched in June 2005). Most respondents indicated that they were already active in their craft area beforehand, and Etsy simply offered them a new (and often better) way to sell their goods. Competitor sites that were mentioned include eBay, Artfire, and JustBeads.

Primarily, people learned about Etsy via word-of-mouth from discussion forums, other crafters, or friends. A couple of folks mentioned magazine articles.

What is your top-selling item? Why do you think it is so popular?
I asked this because I wanted to see a good representation of popular items. Positive features mentioned included that their item appealed to a broad crowd, was priced fairly, and made a great gift idea. Below is one item from each seller, along with a link to their store (in order of e-mail response). Many sellers sell one-of-a-kind items, so the item may be sold, but you can look around for similar items. Item prices range from $2 up to around $40. I love the variety!

What is your revenue per month?

I promised to only share this information in aggregate. But my first impression was – Wow! Some people making serious money. Of course, at the other end, there are many people who are just starting out or are just treating it as a hobby. I forgot to ask if this was gross or net, but the fees are at most 10% of the gross, so it’s still very impressive.

Do you think the Etsy fee structure is fair? (20 cents non-refundable listing fee + 3.5% flat of each sale.) What would you do to improve it, or how does it change your behavior?
Interestingly, every single respondent felt that the fee structure was at least fair and reasonable. The fee can be significant, especially if you realize that it does not include PayPal transaction fees of 2.9% + 30 cents. You will notice that most items are at least $2, otherwise the Etsy/PayPal fees would kill all chance of profit.

Of course, people who really don’t like the price structure aren’t going to be Etsy sellers. However, many people noted that the fees were much cheaper than eBay. Also, selling items through a retail “brick and mortar” store or art gallery usually means giving up 30-50% of the retail price.

* Special Note: Re-listing Items
One common theme that I didn’t know about is the concept of “listing” and “re-listing”. Apparently, the search results on the Etsy site are sorted by how recently you listed the item. Therefore, there is pressure to “re-list” items regularly so that your stuff shows up higher on search results and brings more exposure. If you have 10 of one item, it is better to re-list a single item over and over as they sell. Others complain that re-listing sometimes doesn’t work properly, with items either taking a very long time to show up, or a bunch of items all showing up at once.

Is this a hobby, part-time job, or full-time job?
Most folks were split between hobbyists (sales are erratic and not required to live on) and folks who treat it as a full-time job. Most full-timers said that Etsy was a big part of their income as artisans, but not the only part.

— End of interview questions —

Most shopowners seemed very happy to talk about their products and experiences. I think part of this is that this is a labor of love that you have to really want to get into. It’s not like being a receptionist where you’re just working so that you can eat while doing your passion. This probably is your passion.

In general, there were a lot of common views with entrepreneurs from around the world. Etsy shop owners love that they see a direct relationship between hard work and results, unlike some 9-5 jobs. Customer service is important. It can take a long time to build up sales and a brand, but many see improvement each month. Networking with other Etsy sellers is very helpful.

A more specific tip would be that taking good pictures is very important. Got more questions? Leave a comment! I will let the sellers know about this post.

Wanted: Etsy Seller For Interview

I’ve recently been interested in the website Etsy.com, which is an online marketplace for buyers and sellers of handmade items (and craft supplies and vintage items). I know someone who makes some pretty cute baby clothes with hand-stitched animals on them.

For sellers, the fee schedule appears to be pretty simple. You pay a listing fee of 20 cents for each item (nonrefundable if it doesn’t sell in 4 months), plus a flat 3.5% of every sale. The average sale is about $15-$20. With over $10 million is sales each month, this can be a easy streamlined way for creative people to make some money on the side.

I’m looking for a reader who is an experienced Etsy seller to do a sort of Enterpreneur Interview-type of post. You’ll get a chance to share your story and also publicize your storefront and products. Sound fun? Contact me :)

Free Incorporation / LLC Service From MyCorporation

Update: This offer has expired, but there is a coupon code CABIN-20D good for an additional $20 off their $49 dollar LLC or Incorporation filing package. Net price under 30 bucks!

In case your plans include formalizing your business ventures, MyCorporation is offering their LLC formation and incorporation filing services for free until 1/31 with the coupon code MYFREE. You must still pay shipping fees and the filing fees charged by each state.

Free Corps & LLCs: Regular price of $149 is being waived when coupon MYFREE is used to obtain discount. Document shipping, state fees, publication fees, and additional product fees are additional. Discount valid for orders placed for a new corporation or limited liability company only. Prices subject to change without notice. Limit one discount or coupon per order. Coupon is not valid on any other product or service. You must enter/mention the coupon code at the time your order is placed. Coupon or discount is not valid on previous orders. Refunds/credits/adjustments will not be issued on prior orders.

MyCorporation is owned by Intuit, makers of TurboTax and Quicken. I view such online incorporation services as similar to TurboTax for taxes. Yes, you could fill out your 1040 tax forms manually, but it’s much easier to go through a question-and-answer software that walks you through it and explains the steps. However, if you’re talking about a huge business or something that is complex, then you should hire a professional to handle it (accountant for taxes, lawyer for incorporation).

When I formed my S-Corporation, I used one of their primary competitors LegalZoom and paid about $150 for the service – not including the state filing fees and shipping – so having it done for free seems to be a great deal. (I’m sure they’ll try to upsell you some additional services.) It was good to have someone look over the forms before submitting, while avoiding thousand of dollars of fees from a lawyer for our little venture.

The decision between staying a sole proprietor/partnership or forming an LLC/corporation is not always simple. If you’d like to dig into the details, I recommend the book LLC or Corporation? How to Choose the Right Form for Your Business from Nolo Press. I chose to go the S-Corp route primarily for the payroll tax savings.

(You can even have a LLC and chose to have it taxed as an S-Corp, as if things weren’t confusing enough!)

Entrepreneur Interview: Lester of BevShots.com

Even in these tough times, there are still plenty of motivated and passionate people taking risks and starting new businesses. One of these folks is Lester Hutt, who is the founder of BevShots.com, which takes microscopic photos of your favorite drinks and turns them into beautiful art. The piece shown above is English oatmeal stout. I know Lester through a long-time friend, and he agreed to share some of his business experiences as well as how it has affected his family’s personal finances.

What was your inspiration for Bevshots?
I was working as a business research analyst at Florida State University, and my job was to find possible business opportunities out of university research projects and patents. I came across the work of research scientist Michael Davidson, who took photographs under a microscope of a variety of items including DNA, biochemicals, and more. He also did cocktails, which he initially used for a tie collection.

I’ve never really understood abstract art, like a blue wall at a modern art museum that is supposed to express “man’s frustration with industrialization in the 20th century”. I thought that this would be a great opportunity to make a form of modern art that is affordable to the masses.

What previous experience did you find most useful in starting this new business?
For one, my time working for Apple taught me the power of good industrial design and creating a great user experience. In addition, I had just spent the last several years running every aspect of a small business, from product development to managing employees to sales.

How did you come up with the initial funding costs?
We used a combination of loans from family, personal cash reserves, and a revolving line of credit with local community bank. Thanks to my existing banking relationship from the aforementioned small business, it wasn’t difficult to secure a loan with relatively favorable terms.

How did this affect your personal finances?
It definitely affected us quite a bit. For one, we went from two incomes to having only income to support our family. We started looking for places we could cut back, including going out to eat, canceling our cable television, clothes, and travel. We’re also thinking of buying a used car as our next work vehicle.

Besides trimming expenses, we also found that we were unable to take advantage of other investment opportunities like real estate that we might have otherwise pursued. We do still maintain an emergency fund with 8 months of liquid cash. Even in a worst-case scenario for the business, we will still be okay.

More after the jump:

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Online Business Savings Accounts

Someone e-mailed me about high-yield savings accounts for businesses. These can be a helpful tool to maximize interest income for all kinds of businesses with idle cash, including sole proprietorships, partnerships, LLC’s, and corporations. Here’s a quick rundown of some favorites.

Capital One 360 

The Capital One 360 for Business Savings Account pays 0.40% APY and has no minimum balance requirements or monthly fees. The benefit of this savings account is that you get the “it just works” factor of Capital One 360. There are no bells and whistles, it simply pays you a good interest rate, and provides easy and fast transfers to/from your existing business checking account.

Capital One / Costco
If you can open with at least $1000 and will keep at least $100 in your savings account, you can get a slightly higher interest rate of 1.40% APY with the Business Money Market Account from Capital One Bank. The perks of this account include checkwriting ability (you are limited to 6 withdrawals per month, 3 of which can be checks) and the sign-up bonuses for Costco users. Executive members can get $60 and Gold/Business members can get $20 after you open your first account and deposit $5,000 within 30 days.

(Considering upgrading to Executive? Buy a Costco membership certificate and get over $50 in coupons.)

Fidelity Investments
For maximum flexibility, you can open a Fidelity Account for Businesses and invest in anything from a money market fund to bond mutual funds to individual stocks. (Online stock commissions range from $8 to $19.95.) You’ll need $2,500 to open, but there are no minimum balance requirements or annual account fees. Currently, money market yields in general are very low. The Fidelity Cash Reserves fund currently has a yield of 0.28%. But if you were so inclined, you could invest in Treasuries, municipal bonds, inflation-protected bonds, or even dividend stocks.

Outliers: Hard Work, Luck, and Success

Why do some people exceed far more than others? This is the question asked by the book Outliers: The Story of Success by Malcolm Gladwell. The short book argues that most people erroneously believe that very successful people are primarily products of a high intelligence and lots of talent. But there are many other variables out there, ranging from their date of birth, to their family’s cultural background, to sheer luck.

But the most important relationship was between hard work and luck. In the Chapter called “The 10,000 Hour Rule”, Gladwell states that it takes 10,000 hours to master a subject – be it hockey, music, or computer programming. There are no shortcuts to this.

However, Bill Gates got 10,000 hours of computer time while attending an elite private school before he even reached college in 1973, at a time when many top universities didn’t even have computer labs. Before they became famous, The Beatles ended up playing at a club in Germany for over 8 hours a day, 7 days a week. This meant they accumulated more live stage time (1,200 performances) in a couple years than most bands had in a lifetime. In other words, they both had a nice does of luck to be able to get their 10,000 hours in when very few others had the same opportunity.

At the same time, they also had the ambition and drive to actually complete those 10,000 hours. Sometimes I think that “talent” is no more than loving something so much that you don’t mind spending endless hours doing it.

So to be extraordinarily successful, you need both luck and hard work. People can interpret these stories differently. One person might say “Yup, those guys were successful because they were more lucky than I was.” and then feel better about their lives. The thing to remember is that between hard work and luck, you can control only one.

If you don’t put in the hours, there is essentially zero chance of success. If you do, then when opportunity hits, you can flourish. Gladwell connects the Chinese proverb stating “No one who can rise before dawn 360 days a year fails to make his family rich” to a special public school network within low-income areas that creates kids who can compete with those from private schools in wealthy suburbs.

Although I was initially afraid that this book would try to put too much emphasis on the role of luck, in the end it actually reinforced my own basic beliefs about hard work. You can’t control the cards you are dealt. All you can do is play them as best you can.

How To Be Happy With Your Work

Bud Caddell shows us how to be happy in business with a clever Venn diagram. Very insightful and concise!

Which is harder? Saying no to work that pays well, getting better at something you’re not, or learning to monetize? It was definitely tough for me to say no to something you do well and get paid good money for. I had to save up enough money first to be comfortable with getting better at something else I like better. Via Daring Fireball.