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| by Chris McGinty of AccordingToWhim.com |
I’m going to tell you about two
people and their point of view on ventures and risk. We’ll call them Nathan and
Chris. It’s just the two names that came to mind. I’m not sure why.
Nathan is a false optimist. He’s
the type of person who walks into a comic book shop in a busy strip mall and
sees 15 people walking around. There’s one guy who is probably in the comic
book shop’s top ten customers buying his monthly haul of geekdom goodness.
Nathan’s mind then says, “There are probably 15 people passing through here
every hour during peak time, and they’re probably all buying a minimum of $20
worth of stuff. If they do this for three hours straight they’ve almost made
$1,000 in sales, which I’ll call $1,000 because some people buy more, and I’m
not even considering the slower daytime hours. If they have a 20% profit margin
then they’re making $6,000 a month running a shop with a whole bunch of cool
stuff. If I opened a shop and did only half of that I’d be bringing down
$36,000 a year. Not bad.”
the type of person who walks into a comic book shop in a busy strip mall and
sees 15 people walking around. There’s one guy who is probably in the comic
book shop’s top ten customers buying his monthly haul of geekdom goodness.
Nathan’s mind then says, “There are probably 15 people passing through here
every hour during peak time, and they’re probably all buying a minimum of $20
worth of stuff. If they do this for three hours straight they’ve almost made
$1,000 in sales, which I’ll call $1,000 because some people buy more, and I’m
not even considering the slower daytime hours. If they have a 20% profit margin
then they’re making $6,000 a month running a shop with a whole bunch of cool
stuff. If I opened a shop and did only half of that I’d be bringing down
$36,000 a year. Not bad.”
Then Nathan looks on Kickstarter
and sees a board game that came right out the gate with $30,000 in the first
two days. It’s an established company, but board games are big right now.
Nathan’s mind then says, “If they bring in $30,000 every two days, they’ll make
$450,000 by the end of their 30 day Kickstarter. If I made a board game and
only made 10% of what this established company was able to make, I’d get
$45,000 to make my $35,000 game. That’d be $10,000 in 30 days. Not bad.”
and sees a board game that came right out the gate with $30,000 in the first
two days. It’s an established company, but board games are big right now.
Nathan’s mind then says, “If they bring in $30,000 every two days, they’ll make
$450,000 by the end of their 30 day Kickstarter. If I made a board game and
only made 10% of what this established company was able to make, I’d get
$45,000 to make my $35,000 game. That’d be $10,000 in 30 days. Not bad.”
When Nathan tries these things,
they don’t work out as well as his mind presumed they would work. In fact, they
didn’t even get close to any of his expectations. His eBay sales always did
pretty good, so it’s not that people aren’t spending money. He’s got a positive
attitude and a good work ethic, so it’s not his fault that these things failed.
It must be the location where he setup his comic book shop, because why else
would no one come in and buy? And the board game. That’s just because board
gamers are so elite that they just prejudged the game, because every other
board game does well. Heck, that one game that was more about the miniatures
made over $1 million.
they don’t work out as well as his mind presumed they would work. In fact, they
didn’t even get close to any of his expectations. His eBay sales always did
pretty good, so it’s not that people aren’t spending money. He’s got a positive
attitude and a good work ethic, so it’s not his fault that these things failed.
It must be the location where he setup his comic book shop, because why else
would no one come in and buy? And the board game. That’s just because board
gamers are so elite that they just prejudged the game, because every other
board game does well. Heck, that one game that was more about the miniatures
made over $1 million.
Chris is a false pessimist. He’s
hanging out with Nathan at the same comic book shop, and his mind is screaming
at him, “Oh my god!” it shrieks, “This place is going to be closed down in
three months. They’re probably paying between $2,000 and $3,000 a month in
rent. They’re probably paying that with a bank loan. Meanwhile, they have all
of these people in here, and all they’re doing is saying, ‘Oh, how cool,’ about
all the stuff that they aren’t going to by. There’s that one guy, and he’s
probably their only consistent customer. Once he has a girlfriend, they won’t
even be getting his paycheck. This place is doomed.”
hanging out with Nathan at the same comic book shop, and his mind is screaming
at him, “Oh my god!” it shrieks, “This place is going to be closed down in
three months. They’re probably paying between $2,000 and $3,000 a month in
rent. They’re probably paying that with a bank loan. Meanwhile, they have all
of these people in here, and all they’re doing is saying, ‘Oh, how cool,’ about
all the stuff that they aren’t going to by. There’s that one guy, and he’s
probably their only consistent customer. Once he has a girlfriend, they won’t
even be getting his paycheck. This place is doomed.”
Then when Chris is looking
through Kickstarter, he immediately starts looking at all the poor jerks who
just want to make a cheap $10,000 movie. His overcritical brain says, “They
have headshots of all their actors, and they have a script. They could do this
thing, but nobody cares about some low budget wannabes. And he supposes that he
should really be looking at the board games, which seem to be doing better, but
look at this poor woman who just wants to sell her short story collection.
She’s only made $300 out of her hoped for $3,000, and her Kickstarter ends
tomorrow. Ok, fine I’ll look at that board game. They made $30,000 in the first
two days, but clearly that’s the game company’s mail list. They’ll be lucky to
make another $10,000 over the next four weeks, and that’s only because they’ve
done five games previously. A startup could never do this well.”
through Kickstarter, he immediately starts looking at all the poor jerks who
just want to make a cheap $10,000 movie. His overcritical brain says, “They
have headshots of all their actors, and they have a script. They could do this
thing, but nobody cares about some low budget wannabes. And he supposes that he
should really be looking at the board games, which seem to be doing better, but
look at this poor woman who just wants to sell her short story collection.
She’s only made $300 out of her hoped for $3,000, and her Kickstarter ends
tomorrow. Ok, fine I’ll look at that board game. They made $30,000 in the first
two days, but clearly that’s the game company’s mail list. They’ll be lucky to
make another $10,000 over the next four weeks, and that’s only because they’ve
done five games previously. A startup could never do this well.”
When Chris tries these things,
he’s expecting seven years of failure before he sees any sort of progress. He
believes that field is too crowded, and some people have to dropout before he’s
got a shot. Did you know that 9 out of 10 businesses fail within the first 5
years? Clearly, he and Nathan have 8 more businesses to build before they’re
going to see any sort of breakthrough. And Kickstarter. They might as well call
that Pre-OrderMyShit.com, because the only way to succeed on there is to have
an established clientele. Maybe we could keep listing and build a following,
but it’s never going to be Floodgate Games numbers.
he’s expecting seven years of failure before he sees any sort of progress. He
believes that field is too crowded, and some people have to dropout before he’s
got a shot. Did you know that 9 out of 10 businesses fail within the first 5
years? Clearly, he and Nathan have 8 more businesses to build before they’re
going to see any sort of breakthrough. And Kickstarter. They might as well call
that Pre-OrderMyShit.com, because the only way to succeed on there is to have
an established clientele. Maybe we could keep listing and build a following,
but it’s never going to be Floodgate Games numbers.
The truth is somewhere in
between.
between.
Nathan’s expectations are based
on how well the top 10% of businesses are doing, and he’s tempering his optimism
by planning on doing a fraction of what those businesses do… at first.
Meanwhile, Chris is so suspicious of quick money that he fails to understand
that there is still some quick, legitimate money out there that he and Nathan
could be making.
on how well the top 10% of businesses are doing, and he’s tempering his optimism
by planning on doing a fraction of what those businesses do… at first.
Meanwhile, Chris is so suspicious of quick money that he fails to understand
that there is still some quick, legitimate money out there that he and Nathan
could be making.
Nathan finds failure devastating,
figuring that if it didn’t work the first time it’ll never work. Meanwhile,
Chris doesn’t factor into the 9 out 10 businesses failing the fact that the
numbers are skewed by the people who try once and never try again. He and
Nathan may have only needed to fail a couple of times to learn enough to
succeed next time.
figuring that if it didn’t work the first time it’ll never work. Meanwhile,
Chris doesn’t factor into the 9 out 10 businesses failing the fact that the
numbers are skewed by the people who try once and never try again. He and
Nathan may have only needed to fail a couple of times to learn enough to
succeed next time.
Nathan believes that you can
Search Engine Optimize your way to tons of hits. Meanwhile, Chris figures that
a website needs quality hits over quantity hits, not figuring that a good rush
of quantity might bring in a few good quality hits.
Search Engine Optimize your way to tons of hits. Meanwhile, Chris figures that
a website needs quality hits over quantity hits, not figuring that a good rush
of quantity might bring in a few good quality hits.
Nathan has a good career, because
he esteems a good standard of living, and he wasn’t going to let something like
an income slow him down. Meanwhile, Chris delivers pizza and watches videos
about minimalism.
he esteems a good standard of living, and he wasn’t going to let something like
an income slow him down. Meanwhile, Chris delivers pizza and watches videos
about minimalism.
What I’m saying is that Nathan is
the Keymaster. He’s the one who is able to open the gate to untold wealth,
because he sees that people do it every day, and he knows he can as well. Chris
meanwhile is the Gatekeeper. He keeps the gate closed to false hope in an
attempt to temper disappointment a little bit, figuring that one day true
success will arrive. And even though Egon thinks it would be a bad idea, we
have to get these two together.
the Keymaster. He’s the one who is able to open the gate to untold wealth,
because he sees that people do it every day, and he knows he can as well. Chris
meanwhile is the Gatekeeper. He keeps the gate closed to false hope in an
attempt to temper disappointment a little bit, figuring that one day true
success will arrive. And even though Egon thinks it would be a bad idea, we
have to get these two together.
Chris McGinty is a blogger who
might not look as good in that dress as Sigourney Weaver, but might possibly
look better in that dress than Nathan.
might not look as good in that dress as Sigourney Weaver, but might possibly
look better in that dress than Nathan.