I recently attended a presentation where I was re-introduced to the 80/20 Rule. This is a concept that I was familiar with prior to this presentation, but for whatever reason I did not grasp its significants until now. The 80/20 Rule argues that you will achieve 80% of the desired results for 20% of the effort. The remaining 20% of the results will require an additional 80% of the effort. This is a refreshing concept for those who drive themselves mad in an attempt to achieve perfection.
So, if you’re trying to build a $100m company, dial back your effort to 20% and you’ll be sitting pretty at $80m.
Sometimes I wonder if other business owners agonize over big decisions as intensely as my partner and I do. When opportunity or crisis presents itself, Ryan and I spend an enormous amount of time beating the pros and cons of each possible decision to death. I think this agony is a necessary evil and, for us, it has resulted in more good decisions than bad, so far. Here are a few examples of tough decisions we’ve dealt with and their outcomes:
Yes, that’s a real quote. Read my response here.
A basic understanding of web development is crucial for anyone pursuing ideas that involve heavy use of the web. Solely examining the user-facing portions of the web often results in half-baked and unrealistic business ideas. Examining and understanding (even on a basic level) the complex inter-workings of the internet’s front-end and back-end code can spark great ideas that are practical to execute. I receive more impractical or flat out horrible website ideas from people who have no clue what goes on behind the scenes of a website.
If you spend any amount of time reading tech news (Techcrunch, Mashable, etc), then you are familiar with the fundraising obsession that exists among tech start-ups. There are plenty of business scenarios that warrant, or even require, investment capital. In general, if your product requires a large amount of cash to gain initial traction or combat competition, then you need to raise money. On the other hand, if you are able to gain traction organically and competition in your particular niche is mild, it might be a good idea to resist the money-raising urge.
We’ve decided to offload our order fulfillment operation for Rowdy Gentleman to the Austin-based fulfillment company Amplifier. After lots of consideration it is the obvious best move. This is a dilema that we have been contemplating for months. The idea of keeping it internal and controlling our entire e-commerce operation from start to finish was definitely appealing. By controlling fulfillment internally, we are able to respond to issues and react to changes more quickly. This was essential in getting RG off the ground, but as order volume continues to grow, nightmare visions of setting up offsite warehouses and training fork lift operators are causing sleepless nights. We are in the business of content creation, product development, and marketing. Deviating focus from our core business is a recipe for disaster, so here’s to hoping for a smooth transition…