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The difference between shopping and working

I have started four companies.  For the first one, I raised over $10 million from venture capitalists.  I also spent over $10 million.  In between, the company generated virtually no revenue.  A year after the raising funds, the company was out of business.

For my last business, I spent about 300 bucks and then got profitable.  The company went on to make millions, and I literally never had a day without profit.

Through all that experience, I learned the difference between shopping and working.

Shopping: Hiring a design agency for $2,500 to create a logo that is recognizable, memorable, brandable, and cute, then spending three months tweaking the logo to make it perfect.

Working: Realizing that the brand makes the logo memorable, not the other way, and then hiring a guy off Craiglist to create a “good enough” logo in two days for $50.

Shopping: Knowing that you need a “web strategy” and allocating $5,000/month to social media.

Working: Knowing that the web strategy is a means to an end (to make money) and tightly controlling your spend while testing and measuring every action you take while eliminating the non-performers.

Shopping: Realizing that you are not at the top of page one for paid search on the keyword “gullible” so you accept Google’s recommended bid of $4.56 per click.

Working: Realizing that the goal is to make money off your clicks even if that means not being able to advertise on every keyword where you desire to see your brand name.

Shopping: Feeling overwhelmed and then hiring someone to help relieve the burden.

Working: Feeling overwhelmed and then taking the time to prioritize your tasks and only focusing on the ones that will bring money in the door while eliminating the others.

Shopping: Haggling with a new employee over his or her salary request of $50,000 per year.

Working: Realizing that the salary request is not the problem; it’s that you don’t need a full time employee.  You can afford to pay a nice hourly wage to this person but to hire him or her for just the ten hours a week of real work that you need taken care of.

This guest post was written by Jason Yelowitz, author of The Bathrobe Millionaire.