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I Own the World’s Best Business, and So Can You

I got a couple of emails from readers a few days back. The first email read…

Vishal, I would like to start a business of my own where I can put my passion of teaching Math into practice, and also earn my living out of it. I really love the way you are conducting your own business. So can you help me with the tools to start my own business?

The second email read…

Is it really possible to start a new small business that also becomes profitable over the years, given that there is so much competition all around? Also, do I really need to quit my job to start something of my own like you have done? I am not yet in a position to give up the security of a regular paycheque.

Well, here is something I wrote an year ago that is my best answer to the above two emails. I am sure many others also feel this constant urge of starting something of their own so that they can take their life’s control in their own hands.

If you are one of them, I hope you find reading what follows worthwhile and helpful in guiding you in your own journey.



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I Own the World’s Best Business, and So Can You
First, a question – Which is the world’s oldest and toughest profession?

If you don’t know the answer, well, it’s parenting.

Now what’s the most dangerous? Fishing, believe it or not. Along with flying airplanes.

The one with the worst pay? Well, that’s of dishwashers or labourers, who scrape the bottom of the income barrel.

If you’d rather earn the big bucks, you’re better off learning to knock people out. No, you don’t need to be a boxer to do that…just an anesthesiologist.

Or you can try becoming a heart surgeon or gynaecologist. Believe it or not, CEOs don’t fall into the top 10!

Now, if I were to ask you – What could be the world’s BEST business?

Before I get down to answering that, let’s first understand from Richard Russell, the founder of the Dow Theory Letters – Wikipedia writes it’s “the oldest service continuously written by one person in the business” – what makes for the world’s best business.

10 Rules of a Perfect Business
If you’re about to start a business or join someone else’s business or if you want to buy stocks in a business, the following list may help you.

The more of these criteria that you can apply to your business or job, the better off you’ll be.

So, here are Russell’s 10 criteria for a perfect business, in his own words…

(1) The ideal business sells the world, rather than a single neighborhood or even a single city or state. In other words, it has an unlimited global market. By the way, how many times have you seen a retail store that has been doing well for years – then another bigger and better retail store moves nearby, and it’s kaput for the first store.

(2) The ideal business offers a product which enjoys an “inelastic” demand. Inelastic refers to a product that people need or desire – almost regardless of price.

(3) The ideal business has minimal labor and overhead costs (the fewer personnel, the better). Today’s example of this is the much-talked about “virtual corporation.” The virtual corporation may consist of an office with three executives, where literally all manufacturing and services are farmed out to other companies. Also, the ideal business enjoys low overhead. It does not need an expensive location; it does not need large amounts of electricity, advertising, legal advice, high-priced employees, large inventory, etc.

(4) The ideal business does not require big cash outlays or major investments in equipment. In other words, it does not tie up your capital (incidentally, one of the major reasons for new-business failure is under-capitalization).

(5) The ideal business enjoys cash billings. In other words, it does not tie up your capital with lengthy or complex credit terms.

(6) The ideal business is relatively free of all kinds of government and industry regulations and strictures (and if you’re now in your own business, you most definitely know what I mean with this one).

(7) The ideal business is portable or easily moveable. This means that you can take your business (and yourself) anywhere you want.

(8) Here’s a crucial one that’s often overlooked; the ideal business satisfies your intellectual (and often emotional) needs. There’s nothing like being fascinated with what you’re doing. When that happens, you’re not working, you’re having fun.

(9) The ideal business leaves you with free time. In other words, it doesn’t require your labor and attention 12, 16 or 18 hours a day.

(10) Super-important: the ideal business is one in which your income is not limited by your personal output (lawyers and doctors have this problem). No, in the ideal business you can sell 10,000 customers as easily as you sell one (publishing is an example).

Overall, I think Russell has hit pretty much all the key points of a great business. And by that measure, I genuinely couldn’t imagine a better way to butter my bread than what I’m doing right now. That’s why I believe…

I Own the World’s Best Business
By the way, if you were to again read Russell’s points above, they strike a chord with how even Warren Buffett defines a great business…

  • Has a durable moat – You are the moat
  • Managed ethically – You cannot run any business for long without it
  • Earns high return ratios – Explained above
  • Generates more cash than it burns – Explained above
  • Has clean balance sheet – See above
  • A one-foot bar – See above

Anyways, reading Russell’s rules of an ideal business, I believe I am fortunate enough to own one – my writing / copywriting / blogging business.

Why do I think so?

Well, let’s get back to Russell’s rules and see whether my business fits into the mould…

(1) The ideal business sells the world, rather than a single neighborhood or even a single city or state.
My writing clients – though very few owing to my focus on Safal Niveshak – come from around the world. So I have written for a small company in Sri Lanka, to one in Brazil and another in the UK. Even as far as Safal Niveshak is concerned, tribe members are spread across 100+ countries, including Syria, Kosovo, and Palestine. What is more, subscribers to my Mastermind Value Investing Course include a few Brazilians, Thais, Singaporeans, Germans, and Danes.

(2) The ideal business offers a product which enjoys an “inelastic” demand.
I can say this for sure for my writing business where I have raised prices at 50% per annum over the last two years (on a low base though), but people are still interested to hire me for the quality they receive.

(3) The ideal business has minimal labor and overhead costs.
I manage my entire business on my own – including all its functions…right from thinking, writing, technology, marketing, billing, and housekeeping…and still work 60% less hours than what I spent at my job 3.5 years back. Plus I face no ego and expectation issues from anyone apart from myself. 🙂

Also, I bear zero costs on office rent, zero on marketing, zero on employees, maintain no inventory, no other working capital, no interest on borrowings – all in all, very clean P&L, Balance Sheet, and Cash Flow statements.

(4) The ideal business does not require big cash outlays or major investments in equipment.
The total money I spent to start my business in 2011 was Rs 10,000, and here is how I spent it…

  • Domain name for 10 years – Rs 5,000
  • Website annual hosting fees – Rs 4,000
  • Personal independence day party with family – Rs 1,000

Since then, I have borne a few other expenses but they have been extremely low and far in between. Two recurring expenses I incur are – one, to host my website, and two, to send you my newsletters…but even those are negligible as compared to the invaluable connections I make with you.

The biggest expense I incur is that of my time – but that’s something without which no business in the world can survive.

(5) The ideal business enjoys cash billings.
My average receivable days would be less than 5, as a majority of revenue is earned before the service is offered. So I operate on a negative working capital.

(6) The ideal business is relatively free of all kinds of government and industry regulations and strictures.
Yes, I pay my taxes honestly…but thankfully, the Indian government is yet to impose a “world’s best business tax” on me. 😉

(7) The ideal business is portable or easily moveable.
Without you knowing it, I have sent you my posts from Rishikesh, Mussoorie, Delhi, Amritsar, Chandigarh, Kolkata, Bangalore, Jaipur, Goa, Varanasi, Qatar, and Singapore.

All I need to run my business is laptop, Internet, and my brain – and I make it a point to carry all these everywhere I go.

(8) Here’s a crucial one that’s often overlooked; the ideal business satisfies your intellectual (and often emotional) needs.
Reading, thinking, and writing is all I do to run my business of helping improve a few lives. What could be more satisfying, intellectually and emotionally?

I’m fascinated with what I do and thus, in Russell’s words, I’m not working, but having fun…or like Buffett says, I tap dance to work.

(9) The ideal business leaves you with free time.
I work for just 3-4 hours a day on my business and have the rest of my time free to do anything that pleases me more than work – playing with my kids, travelling, reading, thinking, and exercising.

(10) Super-important: the ideal business is one in which your income is not limited by your personal output.
My efforts to write this post or my Mastermind lessons do not change with the number of tribe members reading them. While I still need to be around to write my posts, the fact is that the operating leverage is huge here.

How Do the Financials Stack Up?
Now, any business, however great it is, consumes precious time. And in order to live a life of financial freedom (well almost!), your business must earn you money and be profitable.

Without getting into the nitty-gritty of how much revenue my business earns and how profitable it is, let me share that, last year, it earned me 3x of my last drawn full-year salary of 2010 (my last full-year of job).

I am not sharing these details to boast about my abilities, but just to share that a guy with…

  • Average abilities,
  • Average financial position,
  • Average aspirations, but
  • Willingness to take control of his life,
  • Support from his family, and
  • Lot of (created) good luck

…can be financially free and be extremely proud to share his ideas with the world.

I may never run the most remunerative business in the world, but I for sure run the “most happiest” business in the world…for myself and for those who matter the most – my family, and my extended family i.e., you.

But How Does It Matter to You?
Now, why am I telling you all this?

It’s because I sincerely believe that you, if you want, can also start your own version of the world’s best business.

It may be writing, teaching, or doing something else that you are passionate about.

But yes, I believe, you can!

In fact, at some point in your life, you must!

Stand Up, Stand Out, Make a Ruckus
“There are only two mistakes one can make along the road to truth; not going all the way, and not starting.” ~ Gautam Buddha.

In a recent book titled The Icarus Deception, Seth Godin – who has had a great influence on my life as a thinker and writer – writes about the story of Icarus, whose father Daedalus fashioned two pairs of wings out of wax and feathers for himself and his son to fly out of a prison they were captivated in.

Daedalus tried his wings first, but before taking off from the island, warned his son not to fly too close to the sun, nor too close to the sea, but to follow his path of flight. However, overcome by the giddiness that flying lent him, Icarus soared through the sky curiously, but in the process he came too close to the sun, which melted the wax.

Icarus kept flapping his wings but soon realized that he had no feathers left and that he was only flapping his bare arms, and so he fell into the sea and died

The Icarus myth is often used as an example of when hubris or over-confidence – of flying too high – can go badly wrong.

However Seth, in his book, points out that there is another part of the story – Icarus’s father Daedalus also told his son not to fly too low as the water could also damage his wings. So, as per Seth…

Society has altered the myth, encouraging us to forget the part about the sea, and created a culture where we constantly remind one another about the dangers of standing up, standing out, and making a ruckus.

However, he writes, settling for too little is “a far more common failing”.

The crux of Seth’s book is that we all have the potential to do great work in life. However to do so, we need to leave our comfort zones – to fly closer to the sun.

What this requires of us is to have the confidence to take bigger risks and create new things.

This requires facing up to the pain involved in the process, and being open to possible failure and criticism.

All You Need…
Coming back to the world’s best business, here are a few things you need to start one of your own…

  • A passion to create your own life
  • A passion to help others improve theirs
  • Bridging this gap by learning a skill that people would buy to solve a nagging problem they face
  • Good luck – and luck, as you know, is a verb – that you must create through sheer hard work and persistence
  • Your family’s unending belief in your abilities (without this, life could be hell!)
  • Willingness to burn your bridges, so that you get into a “win or die” situation (it worked for me!)

As for the specifics of starting such a business, here is how to go about it (in brackets, how I did it)…

  1. Buy a domain name that relates to the nature of your business (You can buy one from Net4 India) – Approx. Rs 6,000 for 10 years
  2. Host your website (Bluehost) – Approx. Rs 4,000 for one year
  3. Create a WordPress-based website (Get from Bluehost) – Free
  4. Buy a clean and secured website theme (Studiopress) – Approx. Rs 5,000 one-time
  5. Sign up with an email delivery platform (Mailchimp) – Free for 12,000 emails per month
  6. Start creating good quality and focused content (I did it for investors, you can do it for students, engineers, marketers, CEOs) – Burn your midnight oil for this for some months
  7. Create your social presence – Facebook, Twitter, Google Plus – Free
  8. Work…work…work…and you will get lucky and succeed

Do You Need to Quit Your Job First?
I did it…but you don’t have to!

Here are the eight points why I say so. I had written these in my post on how I quit my job, but they are worth repeating here…

  1. Quitting your job must be the last resort, or when you find the burden unbearable and abusive.
  2. Quitting a job and living a fulfilling life isn’t as easy as those who have done it would make out to be. Things get scary at times.
  3. Quitting you job will affect others in your life, so it’s critical that you have an honest conversation with your family first and get their buy into the decision.
  4. Learn an important and saleable skill before you quit your job to start on your own.
  5. Quitting a job can be a path to hell if you get bogged down by failures initially. Don’t expect to get rich quick.
  6. Practice minimalism and lean living at least a year before you plan to quit your job. Instant compromises are heart breaking!
  7. Save money to use as initial capital for your business, and then keep your expenses low. Don’t borrow money for your business till the time you aren’t generating cash.
  8. Don’t believe people who tell you – “How I quit my job, doubled my pay and cut my hours in half”…or something like this. They will not help you if you reach a point of no return.

Now, Before You Start

Twenty years from now you will be more disappointed by the things that you didn’t do than by the ones you did do. So throw off the bowlines. Sail away from the safe harbor. Catch the trade winds in your sails. Explore. Dream. Discover. ~ Mark Twain

I believe there are two ways to live a fulfilling life…

  1. To have passion in your life, and
  2. To have life in your passion

I have chosen the second way, because that is where my heart lies.

Finally, here’s something I read recently that inspired me hugely…and can serve you a great inspiration as well…

Love Your Path by Paolo Coelho

  1. The path begins at a crossroads. There you can stop and think what direction you want to take. But don’t spend too much time thinking or you’ll never leave the spot. Ask yourself the classic Carlos Castaneda question: Which of these paths has a heart?

  2. The path doesn’t last forever. It’s a blessing to travel the path for some time, but one day it will come to an end, so be prepared to take leave of it at any moment.

  3. Honor your path. It was your choice, your decision, and just as you respect the ground you step on, that ground will respect your feet. Always do what’s best to conserve and keep your path and it will do the same for you.

  4. Be well-equipped. Carry a small rake, a spade, a penknife. Understand that penknives are no use for dry leaves, and rakes are useless for herbs that are deep-rooted. Know what tool to use at each moment. And take care of your tools, because they’re your best allies.

  5. The path goes forward and backward. At times you have to go back because something was lost, or a message to be delivered was forgotten in your pocket. A well tended path enables you to go back without any great problem.

  6. Take care of the path before you take care of what’s around you. Attention and concentration are fundamental. Don’t be distracted by the dry leaves at the edges. Use your energy to tend and conserve the ground that accepts your steps.

  7. Be patient. Sometimes the same tasks have to be repeated, like tearing up weeds or closing holes that appear after unexpected rain. Don’t let that annoy you; it’s part of the journey. Even though you’re tired, even though certain tasks are repeated so often, be patient.

  8. Paths cross. People can tell you what the weather is like elsewhere. Listen to advice, but make your own decisions. You’re responsible for the path entrusted to you.

  9. Nature follows its own rules. You have to be prepared for sudden changes in the fall, slippery ice in winter, the temptations of flowers in spring, thirst and showers in the summer. Make the most of each of these seasons, and don’t complain about their characteristics.

  10. Make your path a mirror of yourself. By no means let yourself be influenced by the way others care for their paths. You have your own soul to listen to, and the birds to whisper translations of what your soul is saying.

  11. Love your path. Without this, nothing makes any sense.

If you finally decide to start your own version of the world’s best business, and want me to help you decide or to play the devil’s advocate, my doors and windows are open for you.

As for my consultancy fee, you can pay me via a promise to share the learning with someone else in the future. 🙂

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About the Author

Vishal Khandelwal is the founder of Safal Niveshak. He works with small investors to help them become smart and independent in their stock market investing decisions. He is a SEBI registered Research Analyst. Connect with Vishal on Twitter.

Comments

  1. Inspirational is the word, Vishal. Thank you so much for sharing your story and inspiring your tribesmen to start their own.

    The more I read you, the more I admire you.

    To repeat what another tribesman wrote in an earlier post you wrote, whenever I read such kind of excellent posts I feel as if God is speaking through your words. So thank you so much! Cheers!

  2. Loved the post! 🙂

    Especially your last line – “As for my consultancy fee, you can pay me via a promise to share the learning with someone else in the future.”

    You are not just an amazing storyteller but also a great human being. I wish I was just 10% like you. Thanks Vishal!

  3. One word. Inspirational. 🙂

  4. Inspirational…

    Regards,
    Jana

  5. Very inspiring.
    Many thanks VishalJi for sharing this!

  6. Good going Vishal…

    I can add one thing which you forgot to mention.A good business adds value to the society and certainly you are doing that.

  7. Swaminathan Kumaran says:

    Thanks Vishal. That too on a auspicious day. Feel like it has come from Ganesh 🙂 I been contemplating on this 🙂 Hope will come out of it.

  8. Akhilesh Pathak says:

    Dear Vishal,

    I was eagerly waiting or a post like this and here it is, Ganesha speaks through Vishal 🙂

    “To be yourself in a world that is constantly trying to make you something else is the greatest accomplishment.” – Ralph Waldo Emerson

    You are an inspiration for me to discover and become who I am 🙂

    With warm regards

    Akhilesh

  9. I just want to add my 2 cents. Before taking the decision to quit job you need to make sure you have back-up funds and assets to back-upon incase your venture fails or provides poor results. This may sound obvious but you need sufficient fund to sail you through for 1-2 years even if you fail to generate significant income. Even if you build a skill which is in high demand and get everything right, you will still be subject to market forces and economic situations which are quite uncertain.
    For instance you may want to have your own house or property to stay on and with min. loan liability so that you have a place to live and thrive irrespective of what happens to your new venture.

    “All you need” above was an interesting and useful tip. However, one has to budget for the funds, which may be feasible, but if one doesn’t know how to use the tools, websites, etc.. it can still go waste. So some investment in learning the trade, some experience/knowledge building as well as a pilot project (while you are in job) may be a better way to test the venture before you take a full-time plunge.
    You may not agree with me or I might sound conservative, but taking a decision to quit from a job is still not accepted well in Indian society particularly in the middle-class scenario where you are known and respected by your position/job.

  10. Anil Valecha says:

    Very inspiring words, Vishal. Your messages are eye openers for dreamers. I want to become a copywriter like you. I honestly admire your writing and convincing skills. Keep up the good work.

  11. Amit Kumar says:

    Immensely Inspirational 🙂

  12. Shamil Abdul Kader says:

    Very inspirational and knowledgeable post.

    I came across a very useful website to learn about bloging and online businesses. This blog is maintained by Pat Flynn, who lost his job at an architectural firm during recession of 2008 and started online business. I read the ebook “Let Go” by Pat Flynn which describes how he lost job and started making a living out of online business. Very inspirational story.

    I also created a blog in wordpress to get a taste of bloging. Let me see how it goes.

    It seems wise to do this as a source of passive income along with the regular job. But I think it would not happen properly unless we “burn the bridge”. It is difficult to work on anything substantial along with the demands of the regular job and family life unless we burn the midnight oil (Pat Flynn’s father claims that Pat’s sleeping patterns are very bad – no wonder).

  13. Great stuff Vishal……the worth of your blogging business is much more than the money it gets you because of the great help it does to people like us – your readers.

  14. anshul gaur says:

    very intriuging and thought provoking, Vishal… Indeed as I read in a book long ago, “Spend a few minutes with yourself, everyday, and u will be a happy man”… We all need to listen to own calling once in a while, and if it does make u own a great business, thats what we Indians call Sone pe Suhaga…
    Anyways, I have finished with my exams and have given u an email. have n’t heard from you though.. have given an email to ur account as also left a note in mastermind post..
    waiting for ur reply…

    Anshul

  15. Hi Vishal,

    Beautifully mapped Russel’s 10 criteria with your business.

    I need your consulting on copy-writing 🙂 Please, please conduct a workshop for bloggers.

    Best,
    Avadhut

  16. muralikrishnan says:

    Great post Vishal.. Its truly inspirational. Though many of us have will to make it on, we lack planning. This kind of post always reminds me about the necessity of good plan to achieve what you dream..

    Good luck for your all future endeavors

  17. “Many knows the way, few takes it”- Gautham Buddha.

    Many few know the ways and mode to start on their way, but few start it, and you have done it.. Congratulation.

    If one research rich people , you will find a common thread that they are doing what they love and passionate about and they do it exceedingly well.

    In my view that is a sweet spot. I think you have hit the sweet spot and wish you all the best.

    Parag

  18. I love your gesture of sharing so selflessly.
    Excellent write up and keep it going.
    Thank you.

  19. Sanjay Sharma says:

    Great article Vishal. Self employment/ Entrepreneurship is by its very nature is very risky. I was reading through article of Narayana Murthy of Infosys fame and he said that many people entered into IT business in india in early 80’s and some of them may be more intelligent than them or even have more resources but fate is not in their side. Similarly in his recent interview famous VC fund manager and founder of many leading tech companies Vinod Khosla has opinioned that many people play it so safe (by worrying about financials, planning etc) that even if they succeed in their venture it means very little and scalability is capped because Entrepreneurship by its very definition requires that you need to solve an important problems and willing to assume risk of its failure though we have to take risk in small steps so that have ability to recover from risk and take a new risk.

  20. Good one Vishal.

    You covered all the key points..very practical. Rest is up to the readers to put into practice..:-)

  21. Fire your boss, Do what you love and work better to live more, This is how Chris Guillebeau starts his best seller $100 dollar start up- what follows is 274 pages of biblical material for all aspiring micro business owners. I think any small micro entrereneur wannabe should read this book in conjuction with the beautiful post done by Vishal.

    Hope it inspires many more entrepreneurs!

  22. Dear Vishal ,
    I don’t miss any of your blog.This one really superb because i can see my dilemma what i am going through is getting resolved through your blog.
    Cheers,
    Abinash

  23. Hi Vishal, Truly great piece, your story is not just about financial Security or money. It is also about the reach and connect you create with people. How many of those around, who have much more sound financial strategies or great trade runs or making much more money, but still are obscure save for their domain and near and dear ones. But you have grown now, you are the star which shine high above and show way to others.
    Your popularity is growing day by day, this is the intangible asset value which one can get only when one treads the unknown and take the path less traveled, which makes the all the difference.

    Great post and it touches a cord with its honesty and simplicity.

  24. It takes a good heart and great courage to come up with an article like this detailing one’s own approach in attaining financial freedom. Appreciate it. Would also like to know the roadblocks faced and steps taken to resolve them during your journey of establishing your own business and the lessons learnt on your path, whenever you get time. May god bless you and give you lasting success.

  25. Krishna Agarwal says:

    Hi Vishal….

    Amazing writeup, Straight from the heart… it shows in the words.

    It has sparked a idea in me, much similar to what you are doing but more about helping/consulting small business owners succeed. Will work on it and get back to you. Will need your help in the detailing and writing/editing. Looking forward to such a great articles everyday. Thanks! 🙂

  26. I have done and I am doing exactly what is in the post.
    I am glad that your views also match with me!

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