In the 2000s, I built several businesses--all within the mortgage and real estate industries--and bought several commercial rental properties in Colorado. I was worth millions... on paper at least. In 2007-2008, the American mortgage and real estate markets tanked. In 2009, I filed a personal Chapter 7 bankruptcy, lost everything, and applied to grad school. Those are the basic facts of the story of my late-20s to mid-30s. How I've told this story has evolved quite a bit, becoming a story of its own.
Saturday, February 25, 2017
Thursday, February 16, 2017
I teach a course in entrepreneurship fundamentals, and I also work with many small businesses and startups as a management consultant and executive coach. I frequently recommend must-read business books to my students and clients. These entrepreneurs desperately need to absorb the books' lessons given the chronic and common problems they're each facing in their own businesses.
The list below is the best of the best. I'm including the list here so I can easily refer my students and clients to one list instead of haphazardly referring books as I remember them. If hundreds of my students and clients will benefit from this list, other entrepreneurs may benefit as well.
As I've written before, start-ups should use variable costs whenever possible, growth stage companies should shift to using fixed period costs as revenues stabilize, and mature companies with lots of cash on the balance sheet should invest in primary sunk investments. But why is this true?
Wednesday, February 15, 2017
Another common way to think of Unit Economics (i.e. instead of the method I've described in my prior posts) is to use Customer Lifetime Value (i.e. the Gross Profit of all purchases made by an average customer over the lifetime of the customer's relationship with your company) instead of Price, and to use Customer Acquisition Cost (i.e. how much you spend in marketing and sales efforts to acquire one customer) instead of Variable Costs. This method is often used for subscription services such as Netflix and tech start-ups, partly because software does not have any variable cost except Customer Acquisition Cost (CAC).
Friday, February 10, 2017
Everything I know is wrong.
Why is it wrong? Because everything humans now know will likely be proven wrong, mostly wrong, or at very least woefully incomplete and misguided. Fast forward 50, 500, or 5000 years, assuming we humans don't render ourselves extinct by then, what will historians, archaeologists, and anthropologists of that era see