The Freelancers Show 090 – Smart Passive Income with Pat Flynn
Pat Flynn joins the Freelancers to talk about his claim to fame: Smart Passive Income.
[Hosting and bandwidth provided by the Blue Box Group. Check them out at bluebox.net.] [You're fantastic at coding, but do you have an action plan to take it to the next level? The upcoming book, Next Level Freelance, will help you optimize your freelance business for happiness. The book is packed with actionable steps to make more money, case studies, tips to find more clients, and exercises for you to establish your desired lifestyle. Extras include nine interviews with freelancers who make great money while enjoying great work-life balance, videos on strategies to find quality subcontractors, and videos on making more free time by outsourcing your daily tasks. Check it out today at nextlevelfreelance.com.] [This episode is sponsored by Planscope. Planscope is a project management and collaboration net built for freelancers in the way they work with clients. It makes it easy to price out new estimates and once you’re underway, helps answer the question, “Will this get done on time and under budget?” I’ve been using Planscope to do my estimates and manage my projects and I really, really like it. It makes it really easy to keep things in order, and understand when things will get done. You can go check it out at Planscope.io.] CHUCK: Hey everybody and welcome to Episode 90 of The Freelancers Show. This week on our panel, we have Ashe Dryden. ASHE: Hi there. CHUCK: Reuven Lerner. REUVEN: Hey everyone. CHUCK: I'm Charles Max Wood from devchat.tv and this week, we have a special guest; that’s Pat Flynn from Smart Passive Income. PAT: How are you guys doing? CHUCK: So to quickly introduce Pat, you’re the author of Letting Go, which is a fairly popular book from what I understand. And your Smart Passive Income podcast is very, very popular. PAT: Yeah, they are both doing pretty well. And you know the book got number one in Amazon for entrepreneurship. And the podcast and the blog I have are both taking off and I'm just very blessed to be here and again, thank you for having me on the show today. CHUCK: Yeah. You also talk about on your show, you talked about your family, I think you have two kids. PAT: Yeah, two kids; my son is almost 4. He's a Christmas eve baby actually, so he'll be 4 in just a few weeks here, and my daughter is 15 months. And it’s the best thing in the world, I'm completely just blessed to be able to work from home and be here to witness all their first. I mean, they are the most important thing to me. CHUCK: Awesome. So I have to admit; the first time I heard of you, you did a video for internet business mastery. PAT: A long time ago. CHUCK: That was a long time ago. Then I didn’t hear about you for a while, and the people were talking about your podcast and I went and listen to it and I'm like, “Oh, it’s that guy!” PAT: [Chuckles] Yeah it’s funny, a lot of people have seen that video and have said the exact same thing. That was right after I built the business in the architecture industry, helping people pass an exam that they take. And that did incredibly well. Obviously, I had the help from the internet business mastery folk over there and they wanted to help me on and share about my experience and their paid program and just the success I've had. And since then, things have been going really well and I definitely contribute a lot of my success to those guys over there. CHUCK: Awesome. So I wanted to ask, what do you think was the biggest thing that really helped you get to the point where you were making enough money to kind of quit your job and go out and do this on your own? PAT: Well, I was actually laid off from my position in June of 2008. And at that point, I didn’t really have a plan B; you know, I had just proposed with my wife, everything is working perfect. Actually just a couple of months prior to that, I was promoted. So obviously, this was not expected at all. And for a couple of weeks, I was just really down because I had spent my whole life leading up to that point thinking I had done everything right. I got good grades, I went to college, I got my dream job in an architecture firm in the Bay Area right after that, and to have it all taken away just like that was really tough for me. I'm very fortunate that when I actually had my position, I had started this blog actually; a blog that was basically there to help me and a couple of my coworkers pass this exam. The one that I later turn into a business. And I have passed that exam a few months before I was laid off and I just let the site sit there; I had no really purpose for it anymore. I did spend a year putting content in to it so that I could study from it when I was traveling. It made a lot easier for me to organize that stuff. But like I said after I passed, I just let it sit there. And when I discovered internet business mastery through your podcast and got into their program and understood that if I had something of value to share, I can share it through a blog or a podcast to potentially build an audience, and then get paid for the value in return. I was like, “Hey, I have this website that I've created for myself and a couple of coworkers. Maybe I could turn it into a business.” And the incredible part was I put an analytical tool on the site just to get ready for traffic that was potentially going to come to the site. And the next day, it just blew me away. I saw the graphs; there were like 6,000 people coming on the site every single day already. And I had no idea that its happening. Later I found out it was because I had just written so much stuff and stuff that Google liked and put it on top of their search engine. Some people shared it and stuff. And so to make a long story short, I had this audience there, I opened up the comments, I started answering people’s questions. People viewed me as an expert, even though I wasn’t really an expert. I was just someone who too this exam myself and knew how to answer a lot of people’s questions. But when I sold the study guide and practice exams on the site on October 2008, which happened to be the exact same month that I was laid off, I made an incredible amount of money on the site. And the best part about it is was not just the money that was made, but the thank you’s and the notes that came afterwards from people who are like, “Pat, you saved me so much time; I was able to pass test in the first try.” And those sorts of things. And that’s when I started to make SmartPassiveIncome.com to sort of show people what I had done because there was a whole new world that was brand new to me. I didn’t know about internet marketing online business and to me, it was just a very scummy sort of car sales industry. And here I was in it and doing it what I felt like was a way that I had never seen before. Doing it “the right way”, where I was providing value and getting paid in return first. And so I created Smart Passive Income blog to sort of share those things. And also now, what I do is I build businesses just like that live on site and I show people what I do right, what I do wrong. I do a lot of things wrong but I'm not afraid to share that in hopes that other people will see and sort of make the right decisions based on what I do right and what I do wrong and learn from my mistakes. ASHE: I really like that you include the “doing things wrong” part. I think that a lot of people, anybody who does anything for a living really is always been like you said an expert, always on their game and none are making any catastrophic mistakes. And it’s kind of great to see that other people are human, and to see that we can achieve that too because other people make the same mistakes. PAT: Yeah, I mean I could speak for about 5 hours about these things. I mean business in business and I still continue to make mistakes. As long as I learn from my mistakes and as I'm learning, I share those things that I learn along the way, which is what most my blog posts are about. I do a lot of things right, and I talk about that too and I create reports and case studies and show really the details about everything. But yeah, I mean I think really a lot of people have mentioned that too, they are just like, “Wow, you are not afraid to share what you do wrong.” I'm like, “Yeah, because that would really be helpful for people, I think.” And it sort of put me in this position as the honest and authentic guy in the internet marketing space, which wasn’t the intention at first, it was just kind of the person I am and it’s reflected on my website. And I sort of hearing this now and I do know that a lot of people look up to me, and I wanna share to people that there is a right way to do internet marketing, where you don’t have to pretend you are someone you are not. You can just be yourself and be honest with people, because that’s what people connect with. People today likes to do business with other people. It’s not about business to business or business or business to costumer anymore; it’s about people to people. And the more you can become a people person online, and that means being a little bit vulnerable, sharing a little bit about your personal life, and sharing your mistakes, people are going to connect with you more and trust you more. REUVEN: When you say ‘passive income,’ are our referring to things like eBook and video sales? Are you referring to advertising? Are you referring to other things, combination of these? What would you define is passive income? Because I think we can understand what active income would be. PAT: Sure. I mean, passive income, I mean there's obviously hundreds of different definitions of it. I mean it’s like investor definition, there's like real estate definition. I mean my definition of it is building online businesses that take advantage of systems of automation that allow transactions, cash flow and even growth to happen without requiring a real time presence. So in other words, we are not trading our time for money; internet entrepreneurs instead invest time upfront, creating valuable products and experiences. We work hard now to continually reap benefits later. For example, with my site that teaches people how to pass this Leed exam, which is the exam I was talking about, you can find that at greenexamacademy.com. And you'll see that you can purchase eBooks, you can purchase study guides and practice exams and things like that. And what happens is people come to the site, they find that those might be useful, people purchase them and they automatically get deliver those things electronically via email; they click a link and then they have access to those products or they sign in and they get access to a members area. And during the whole transaction, I don’t have to be actively involved. So that’s the beauty of doing business online is your store, if you set up these systems, your store can be open 24 hours a day, 7 days a week, 365 days a year, providing information, providing value to world and getting paid back in return. Now, I will say that it does mean that you can set up something and forever and ever, it will continue to pay you back. I mean, I still have to upkeep those sites and in the beginning, it’s going to take more investing your time than you will see return and that’s the hard part. That’s what a lot of people struggle with is we're so used to working x hours and getting paid for those x hours. But now, you are putting a lot of time upfront investing that time and then getting paid back in return later. And that's the hard part and the struggle for a lot of people. But it’s a beautiful thing because for example, greenexamacademy.com now, it’s been up for five years and I put one or two hours of work into it every month. One or two hours of work every month and it continually provide between $40,000/month at this point for a while, when this industry was big and it’s just taking off. It was taking between $20,000/month and $30,000/month, again with just a couple of hours of work each month. REUVEN: Wow. I understand what you are saying, but when you are talking about passive income, then you are not talking it sounds like just putting up sites that you are hope will attract enough people, click on ads from ads and make money from that. Or is that also included in the definition? PAT: That is included as well. That is one type of the several types of businesses you could create. I have a site that I built publicly on Smart Passive Income Blog. You can find that at SecurityGuardTrainHQ.com. That was a site that I built from scratch showing people how I chose that niche. It was scientific approach to building that site, because I chose Security Guard Training because I saw in Google, Google gives you report on how many people are searching for different terms every month. And so I found that a lot of people were searching for the term “security guard training”, and that was a relatively low competition keyword. Meaning, the website that was ranking on the first page of Google weren’t very good. And so, I saw an opportunity there; and so I built site, I put content into it. And in 73 days actually, this was the quickest that I've been able to make money online. And that is not usually how it works; typically it could take several months or years, but this one was good niche to get into. In 73 days, that’s like the number one in Google. And it makes money and it has made money for the last three years with AdSense. So that’s just one example. I have another business I share called CreateAClickableMap.com and that actually was a business that was created out of my experiment at the security guard training industry, because I found out through my research that every state in the US has a different set of requirements to become a security guard. So I thought it would be nice and very helpful and valuable to the audience there, if there was like a map in the US that they could click on their state and then it would take them to the article about how to become a security guard in that particular state that they lived in. So what I did was I paid a developer on Odesk.com to create this map for me. And he did it for like $500 or $300 I think. Relatively cheap, but it works. People will click on the state that they live in and it will go to the article. And when I shared that on Smart Passive Income, they’re like, “Wow, how did you create that map? I would like one of my site too.” And so I said, “Oh, go to odesk. Here's the guy.” And I realized that every time I was sending people to Odesk, I was making them pay $300 for this guy to get this map. And I was like, “There's got to be a better, easier, more automated way to do this.” So I created a clickablemap.com. I paid another developer a couple thousands of dollars to create a tool that people can insert their links for any state and press a button and it generates a script that they can put on their website to show a map just like the one I had. And it does it automatically and really quickly, without having to go through any other developer. And that site now is generating between $600 to $1000 a month now, because you can get the map of the US for free, but if you'd like to save your information on my server in order to comeback and edit that map later, you pay a onetime fee for $10. And all the other maps that we have, we are currently adding more, but there's about a dozen; those cost $10 as well. So that’s generating an income as well. And that’s completely automated; the only thing we're doing is just adding more maps, meaning more opportunities, more products to get paid more down the road. CHUCK: So it sounds like there is a bunch of upfront work though to build the sites, to get the traffic, things like that. What are the most important things that you do in order to build the traffic to a website like that? PAT: Yeah I mean, there's this myth of the overnight success right? I mean we hear about it all the time. Those are the stories that make the headlines; Angry Birds overnight making millions of dollars. But what people don’t realize is that Angry Birds was the 60th game that Rovio created. They went through 59 other games before they finally hit it big with Angry Birds. It takes so much work. And nobody sees that part of it. but Anyway, yes it does take a lot of upfront work. Now it depends on what type of business you’re creating, but one of the most popular ways is to start a blog first. And I know you had Leslie Samuel previously. He's a great resource for that. How to get a blog up correctly because a blog is a great platform for you to be able to provide information, for free, to build that audience. And the blog itself won't make you money unless you potentially sell it in the future, but a blog is great platform to launch products and provide services and tools and things like that. That can then make you money in the future, by providing and serving that audience. My security guard training site was sort of a different approach than that of a blog. A blog could take up to years to get to the point where you would have that audience, where you can then sell something to. And there is also the opportunity to do affiliate marketing as well, which I do a lot. And what that is being able to earn a commission by selling other people’s products. Now the method for doing that is fairly easy; you find a product that has an affiliate program. Amazon has an affiliate program. You can actually sell any product on Amazon by getting a special link. You get 6% of that of the sales price in your account. There's other products out there and the commission range obviously. But the point is, you can provide other people’s product and earn a commission on it. Now the technology and the way it works is easy, but doing well that is hard because you want to be able to provide products that are going to help that audience that you built. And that's why affiliate marketing has such a negative connotation these days is because a lot of people abused the power of it or the idea behind it. And they just find first a product that they know are going to make a lot of money, and then they share that product with their audience without even really understanding what that product is or what it does. Or maybe it understand it a little bit, but they don’t really… they are in it for the wrong reasons. If you start with your audience, really understanding what their pains are and what their wants are, then you can provide products and services and tools for them. Sometimes those tools products and services are things that you can create on your own. And sometimes they are things that you cannot create on your own. For example, in smartpassiveincome.com I talked about building websites and creating businesses online. Well, part of that process is to get a domain and a hosting account to set up your website. Well, I can't possibly,…I guess I could maybe but I don’t wanna set up or build my own hosting company. And there are a lot of hosting companies out there there that would do that for you obviously and do that really well. So I share a resource that I have to help people go through and I earn a commission every time goes through that process and the cool part about it, if you approach it from the relationship first; that you want to provide value first, then you’re actually going to be thanked for those recommendations, instead of those people thinking that you are just trying to extract money out of them. The money and your earnings are a byproduct of how helpful you can serve your audience. Now the securityguardtraininghq.com, that was sort of more scientific, mathematical approach to building a website. And that was done based off of trying to rank really high in Google. Because when people are searching for things in Google, they are looking for information, a lot of times they are looking to click on ads or buy things or find information that help them achieve whatever it is that they are looking for. And so my goal with that site was to rank number one in Google. And was done almost in the same way by providing a lot of value and writing content, and making sure the specific keywords that I knew they were typing into Google were put into those articles, and in the metadata and all that stuff behind that too. So that’s a different approach. But really, the major, underlying thing here, if our really want to succeed, you need to find a niche; meaning you have to understand the particular market, exactly what their pains are and the problems and their wants and needs are. And even getting to a point… and I encourage people to do this; you actually sit down and have conversations with people in that target audience or talk to them on Skype or get on the phone, so you can get deep into really what the pains are. Because a lot of times, when you send emails and you get these responses, they're surface level responses. But in order to understand really, truly what would benefit or what would to help these people, you want to talk to them, ask them why, why do you feel that way or what would actually help you, or what are the things you do daily that just you hate doing. And then you might be able to provide a solution for that. And then really going into doing that, and choosing the right platform for that. Logging is one of them. A lot of people, like the people over at Internet Business Mastery, they started their platform on a podcast. A lot of people today are starting their platforms on YouTube, but it’s really important to have that blog that will become your home. That’s thing that you can control and you know whether you have a podcast first or a YouTube channel, you wanna bring people back to the blog, because that’s where you can collect email addresses and better serve your audience. That's where you can provide products and any links to have to other articles. I mean, that’s your site that’s under control. YouTube can potentially get bought out or die out or whatever tomorrow. We see that happen with MySpace. Podcasting, the technology can change and it’s not something you can control. But if you have your blog, you have your email list, really nothing can stop you from being able to provide your audience and then get paid in return. ASHE: So I have a question kind of stepping back for a minute; you are talking about the number of games that took Rovio to kind of come out a winner in Angry Birds. How do you not give up during that time? Like, how many failures? Are you eventually like, “You know, maybe this isn’t working. I should try something else.” PAT: Yeah, that’s a great question. I mean, obviously there comes to a point where you have to decide whether or not whatever it is you are working on if doesn’t succeed, that you need to move on to something else. I think part of that is understanding that failing is a part of the process. You ask any entrepreneur, they will have failed several times. And it’s part of learning process but you have to understand you need to learn from your failures to move forward. Now, Rovio is a big company and so they had a lot of investment capital and things like that to keep them moving forward and keep trying. And if you have a vision and you know you can help people eventually, I can't say how long it will take because it differs. But if you know you can help someone and have a vision, you need to just keep going. A lot of people give up because they are either too distracted, or they try things and then they try something else without putting 100% effort behind that first thing. And that’s a big reason why a lot of people fails because they don't give whatever it is they are working on a chance to get to that point. It’s really important because a lot of people quit or give up right before that inflection point. When something amazing can happen. And there's a lot of things you can obviously to increase your chances of succeeding, you know the market researching and before you even create anything is really important. I highly recommend a book called the Lean Startup by Eric Ries. And that’s about start up world, that’s really with anything. If you are trying to provide value for anybody in any sort of medium, you need to understand work with those people who are in your audience to create something. And I really, really love that approach. Also, making sure you have support around you to keep going. And people were also going to be honest with you about what you are doing. That’s why I am actually in three different mastermind groups. These are groups that meet weekly. Each of them meet weekly, and one person is in a hot seat every time and that person who is in the hot seat calls on everybody else for an opinion or to help or just share something that they need feedback on. And we are all completely honest about it because we know we want to help that person, knowing that we are on the hot seat, they are going to be completely honest and willing to help us too. That was one of the big concepts I learned from Internet Business Mastery. That was actually a mastermind group that I went to, where I discovered that I could provide service for my audience at academy by writing an eBook. And that’s where I learned about eBooks and what that can do and setting up the whole automation process and things like that. I mean, I would not be where I am at today if it wasn’t for people around me. That’s another thing that if you ask any successful entrepreneur and they are honest with you, they will say that, “I couldn’t have done this alone.” You'll find some people that’s will say, “Yeah, it was all me.” But really, there's other people involved. You can't do this alone. So it’s really important to have that support system, whether it’s with friends, or mastermind group. And as far as mastermind groups are concerned, I mean you can… all of mine actually meet virtually. So these are people from all around the world and all around the country at a specific time each month or each week. And so you can do once in person too if you have people in your local area to meet with too. But I can't say enough how important how the mastermind group concept. I think it’s chapter ten in Napoleon Hill’s Think and Grow Rich. The power of the mastermind concepts. It’s really, really important. REUVEN: First of all, just to echo you there that I recently joined the mastermind group and I have been loving it. And I really feel like I have been learning a ton just a month or so since I joined it. So I completely agree with what you are saying there. I have a question about your business model and whether this is something you can encourage other people to do. It’s clearly… based on what you described and from looking at your website, you have all these different businesses; all these different sources of passive income. Do you encourage people to diversify as it were, their portfolio of passive income sources, so that they are not just working on one thing? Or is that something that just comes overtime that like many entrepreneurs, you wanna try one thing and then another thing and build it out. Like basically, do you think it’s a smart idea to have multiple businesses? PAT: I think it’s a smart idea to diversify, and that it’s also a smart idea to focus on one thing at a time. So you know, this is a long term here and you wanna create things one at a time, and you want to give those things that you are working on a chance to be something worthy of your passive income portfolio. Now whether you wanna… it’s tough; you have to make smart decisions and this is where your mastermind group comes in to play, because they are going to help you do this. But if you have a business who is doing really well, you can better provide for that particular audience you have there and create more products. And I've done that before on Green Exam Academy and started with an eBook, and then I had an audio book and then I added some practice exams. And that makes complete sense. And I think that’s when I knew that I had done everything I could to stir that audience and then I moved on. There are opportunities especially when you creating systems of automation, where something might be working for you and then you find another opportunity. And you can either sort of carbon copy what you did in one space and do it for someone else. But I think probably the smartest thing to do at first is if you have an audience, they say in marketing that your best costumer is your existing costumer, because they are someone who trusts you; whose bought from you before and if you can even better provide for them, they are going to be likely to buy from you if they like that first thing they got. But beyond that, you could potentially create sort of vertical… it’s slightly horizontal businesses from your initial one. For example, I could have done this and I didn’t do because this I started Smart Passive Income instead but If I did GreenExamAcademy.com and served as people passing the leed exam, I could have created something to help people pass the architectural license exam. And so that was just slightly related; they are not exactly the same thing; they are different paths from where you go. When you enter the site, the transformation you make after you use the content on the site. But they are related; they could potentially cross promote each other and potential be the same type of costumer. So it will take some massaging and understanding. And really it’s hard to plan all these upfront; you really just wanna focus on one thing and one audiences and serving them. And you might find that that’s all where you need to be. Now I feel that I'm sort of in this particular… I guess you could say position, where I have come to this leadership role on my business space which I'm really fortunate to be a part of, almost unintentionally gotten into the space as a sort of authentic and honest guy, but I also feel like I'm also the crash test dummy. Like I'm so fortunate to have a lot of these good money coming in and an audience that they experiment ideas in the case studies, that I feel like I have to more so than other people, more so than I would recommend to other people, trying new things because this is my way of giving back potentially putting myself on the line or money on the line, to experiment with something; to see if something worth considering for other people. CHUCK: That’s really cool. How do you decide which experiments are worth it? PAT: Well, it’s tough. I mean, I had a shoebox full of ideas I wanna do. [Chuckles] A lot of times, it’s what my audience seems to be the most interested in; what they are asking most about. And at the time when I created the Security Guard Training experiment, that was something that a lot of people like yes, you got to do this. And so I'm actually doing it again right now. I'm right in the middle of my second sort of niche site case study. And I had built a website to help serve those who are starting or who already have a food truck. That’s a big sort of hot industry now, and there were no resources out there to help people get started or help people who are in that industry. And just knowing the food trucks that are here in San Diego with me which I… There are still really behind when it comes to marketing and things like that. I mean they are really old school with things. Yes, they are using iPads to collect credit card, to pay for things, but there are still a lot of things they can do that’s something I felt like I could do to serve this community here, was to what is now Foodtruckr.com. So that’s another sort of experiment. And again, you wanna start with what you are most interested in, but also you don’t have to be completely passionate about that topic. I'm not passionate about Security Guard Training. It’s just so happens that my mom is a security guard, but that really nothing to do with this. It is more I found the opportunity to serve a particular audience and they just so happen to be all security guards. And that was again done through market research; through using Google keyword planner and things like that, to see how people are searching for terms and doing a little bit more research on Google to see what size were out there already providing information for this audience and noticing that there wasn’t really anything good out there. So that’s one place where you can start. But obviously, I think I would start… if you are starting from scratch, you wanna say to yourself, “Okay, what do other people come to you most for?” Like you might have a number of friends who come to you for a partial type of advice. Maybe you might be an expert at grilling, I don’t know. And everyone comes to you and your barbeques because they love just what you do for grilling. So that might be something you could start with and there's a lot of successful recipe sites. And of course, you also wanna approach it like, okay, if you’re going to start something and you find that there are other people doing those things already. That scares a lot of people off. They are like, “Well, I don’t wanna get into this space because there's already that person doing it and they are doing it really well.” Like, why would anyone would want this new person coming in. Why would anyone follow me? Well, A. nobody is like you. Some people are going to connect with you because you are you; not that other person. But B. knowing that there are people out there in that space or niche or market already, is validation that your idea is a good one. That there is a market out there to potentially serve using your skills or skills that you are going to acquire along the way. It also gives you sort of an edge because there are these players in that industry or that market already. You can see what is missing. You can hear or listen to the people who are… of those people who your competitors are audience, you can see what seems to be missing and bring that new thing to the table in that particular market. Positioning is extremely important. One good example of this is in the internet marketing space on the online business space, there's a ton of people now doing podcast with interviews with entrepreneurs, like this one. And they are great, and they all have each of their sort of spin. And that one guys who’s taken off really well recently, this guy named John Lee Dumas. He just started his podcast last year in October and now, he has over 400,000 downloads every month, and he's making five, sometimes six figures a month now with sponsorships and things like that. And he's done really well. But he had a specific position and angle in that market. He wasn’t the first one to interview entrepreneurs -- not at all. But he noticed that there was a hole missing. That was a daily entrepreneur show. So that’s what he did. And I still think he is crazy because producing a podcast episode takes quite a long time, but he's created the system and has a team in place that allows him to do that. And he was able to fill in that gap and be the one that has the daily entrepreneur show on. That’s entrepreneuronfire.com. So positioning and then finding your unique advantage in that market that you are going to enter is really, really important or else you are just going to get lost in the crowd. CHUCK: So I have a kind of a scenario I wanna put out there for you and just see what you come up with fly. I have this friend. Let’s call him ‘Reuven’, and he's got an idea that maybe he wants to teach a course on programming because he's good at that, he's good at teaching people. How would you put things together so that you could market that class to people who would be interested in something like that? Maybe just a two or three day course or maybe a few weeks long depending on how he wants to structure it. PAT: I would first see who your target audience is and maybe where they all are, and see what already other companies out there are sort of providing the service to them or tools or courses for them. So you can make sure that when you come in to it, you have your own certain position into it. And now another thing you might wanna explore is actually Udemy.com. specifically for that niche it shows just coding courses and things. People are doing extremely well on Udemy.com and that is an education platform that’s really cool because all you have to do is provide the video and the content; everything is already set up before you from the platform where they already have traffic, they already have users, they already have the payment processing systems and those things in place. And of course, there's a little bit of a fee to use their service, but that’s the whole creating everything else on top of your course just gets rid of that. And that is actually a place that a lot of people are using to validate their particular concepts. They might be creating… that you can create a free course, you can create a paid course if you want. A lot of people put sort of a skeleton level or beginners basic level course on something there, to see idea is something that they might wanna spend more time doing. So validating your thing is really good too. Now, one thing I would actually recommend that a lot of people are doing, is if you wanna create a course specifically, maybe you don’t have an audience yet, you can promote that course on Facebook using ads. And it’s going to take a little bit of money, but you would want to generate ads to get people into this course. Or perhaps it’s a webinar that you set up’ two hour webinar value packed and you provide as much information as you can. And at the end of the webinar, if you have webinar, you can bring people into a course that you’re going to do. Maybe it’s a four week course where people meet with you every week in a webinar type setting and you will be able to teach them something, take what they learn and then apply it. And then come back next week, and maybe there's a Facebook group that goes along with it to help them all communicate with each other. Maybe you set up your own forum or whatever. Now you might be wondering, how will you film a course if you don’t have one? Well, you actually are creating the course with them. So you develop the content and the material as you are going along. And what that does is it allows you to be able to provide for those people to get on again. You typically pay for these people or maybe you’ve been able to tap into an audience in another blog that already has an audience that you are targeting. You'd be able to create the content as you go along; very lean start up model like, where you would actually tap into your audience as you are going along, to be able to create your course along the way. And when you get to the end, what you have is as beautifully packaged course, people would use it, people who are able to leave testimonials that you can then sell on a place or on your own site and you can drive more traffic to it. Or you can have affiliates come on and sell your course for you on their site to their audience as well. REUVEN: Very interesting. CHUCK: That is very interesting. You did talk a lot about upfront work when you are building these kind go websites. Do you need to do that same kind of with a course like this? PAT: Well, I mean it would be more work upfront each week as your developing course material, but you have to be careful not to go too far because you wanna hear from the feedback from the people on your course, so that you can create stuff. So that the work upfront is the actual first course that you do with these students that you have. And you might be able to promote it on a lower price saying this is the beta version or whatever and then be able to sell at in a more expensive price later. But again, the benefit is having the students in there. So the upfront work would be setting up the process of collecting those other people’s information to then build the webinars and registration and things like that -- which isn’t too difficult. And then creating the course as you go, just like a teacher would in only four weeks, maybe you spend a week or two creating course material for the first session. You all go and watch that, and do whatever actions that you wanna require these people to do in your lesson, and then you can talk with them during the week and then as that second course is coming up, you can create another homework sheet or planner or some other things along the way. I would actually prefer going to the lean startup model if that’s the path you wanna take. And it’s not going to take too much work upfront, but of course it is going to take work upfront. But that work you do to put that course together and compete that course with those initial students, that’s your work upfront for that part that you have and that you can then sell. CHUCK: Awesome. So one other question I have; have you don’t much with membership sites? I know that Internet Business Mastery kind of pushes people in that direction. PAT: Yeah, I mean the membership business model is probably the holy grail of the online business sort of models because I mean membership sites or sort of software that people have to pay to continue to use. It’s the whole idea of this recurring payment. And the beauty of that is, let’s say you have 100 members at very low price like $100 bucks. You are making $1000 for that first month. You get 100 members in there for $10 each. Now the next month, you get another 100 members, now you have 200 members paying $10/month. So you are making $2,000/month. And then the more people that you can put in that membership course, the more money you are going to make each month -- recurring. And of course, there's the idea of retention and making sure people stay in as long as possible, and also being able to qualify for a recurring payment; meaning it’s something that you are continually providing value for. If you just have a product that you are going to charge monthly, I mean, why would people pay monthly if they get everything upfront. You wanna continue to provide them information, you wanna continue to provide them access to certain things. And for membership sites, like Internet Business Mastery, I mean they are continually adding content every month. But in addition to that, I also gives you access to the forums and the community of like-minded people, which I think is a good value add. And will give reason to continue to pay each month as well. But for me, I just came out with my first membership site and it’s closed right now. I'm actually in the “lean startup phase” with this. I launched it in July 1st. It was only open for three days. There's about 400 members in there, and I'm working closely with them to continually add features and things that they would want in there. So it’s really nice because I didn’t have spent too much time upfront to create everything that I though should be in a membership site, but I could create something obviously worth paying for and something of value that I can get them in there. And then work them and have them feel special like they are a part of the evolution of this, and they have a say in where the course or the membership is going. So that’s benefit to them getting there early. And then I'm going to reopen that probably some time next year in the public. I'm sort of diving in and getting into that space now. REUVEN: I feel I'm very interested in the way you talk about this that we are now recording this in November and you say, “Well yeah, I'm working on this membership site I started in July, that’s what four months, five months already and it’s going to take or maybe next year, I´ll be able to open it up.” So you really are taking a very long term, learn from what's working, tweak what's not working and then try to improve and iterate, but it’s not the thing you are doing day by day or week to week necessarily. You are looking at it as you said before in sort of a long game so that you can make it as good as possible. And it’s radically different than sort of the attitude people have about internet marketing. PAT: Yeah it’s a long term project. I mean, I could go fast if it’s the only thing… if I had energy for but I have all these other things. And again, I'm in the position where I have all these other businesses running. Yes, most of them are automated at this point, but there's a lot of things I am focusing on. And it’s the holiday season now, I got two kids and I could easily burn myself out on internet business while forgetting about my family, but the family is the most important thing to me. So I always make sure I spend my time with them as much as possible. CHUCK: That’s really cool. I'm really am trying to do the same thing for this holiday season, but lots of work come in my way and it’s been hard to deal with all of that. PAT: It’s a balancing act. And the interesting thing is everybody talks about this work-life balance thing. If you imagine a balance, left side and right side, there's only one moment when it’s perfectly balanced and that’s so hard to get. And if you try to just be perfectly balanced the whole time, it’s never going to happen. Really what it’s about is making those things on either side similar, so that you can sort of move back and forth but not go way too much on one side or way too much on the other side. But you know, a lot of people try to get to that perfect balance and that there really isn’t ever a perfect balance but there's a perfect way to adjust; there's a perfect way to adapt. And I think really, as an entrepreneur, adaptation is one of the most important qualities; being able to react properly and also balance their life in a way where they can spend time with their family, bet then they are on the work side spending time with work too. It’s a really, really tough thing. And you know, I know a lot of people tackle the idea of efficiency and productivity and stuff, and I almost have this sort of feeling of for what? A lot of people become more productive to do even more of that. When I feel that I have to be incredibly efficient and productive because I don’t give myself much time to work. I have a few hours every day to work, even though I can work more. But what is important to me is to be able to spend more time with my family. So to be able to get more work done, I have to be incredibly efficient. And I sort of like have been discovering hacks along the way for myself to see how can I become more efficient and things like that. Down to the how fast can I reply to emails or types certain things. All those seconds overtime add up. I'm actually starting to come up with a concept for a traditional book that talks a lot about that. There's a lot of great productivity books, but they forget about why we are being so productive. And then it will come from a very sort of family point of view. So that’s just a little insider information for you guys. ASHE: I love those little hacks. Especially as somebody who like I actually travel a lot and I have a really hard time doing things like answering email on a regular basis. I try little tricks with myself all the time to try and make it less painful. [Chuckles] PAT: Yeah, it’s fun to experiment like, “Wow, that actually worked!” or, “Okay, this worked for that one person, but totally not going to work for me.” So I mean for emails specifically, emails are a drain for a lot of people including myself, and I get a lot of emails a day. So I've taken tips from Tim Ferris to batch answer emails. You can get more emails or get three more emails if you actually schedule time to answer those emails instead of answering each individually, one by one and transitioning between email and work, and then going back to email. If you batch process your emails, you are going to get them done much faster. And also, I use tools like Google canned responses or text expander for Mac. A lot of people ask me the same question, I´ll write down the answer beforehand for that particular question and I´ll just type a couple of hot keys on my keyboard and then boom, done. I got through that email in ten seconds that would normally take me 2 minutes. Again, those small minutes add up. ASHE: For sure. CHUCK: All right, well do you guys have any other questions for pat? ASHE: I don’t think so. REUVEN: No, but this has been really interesting. CHUCK: Yeah, definitely. I definitely learned a lot and I really appreciate you taking the time to come on the show. We're going to go to the part of the show where we do our picks, and then we'll wrap up the show. Reuven, do you wanna start us with the picks? REUVEN: Sure and it’s going to be really brief, I actually don’t have any picks for this week. CHUCK: All right, Ashe what about you? ASHE: Sure. So I have two that are on the same subject. I've been doing a lot more reading lately about impostor syndrome, which is the inability to internalize achievements that you’ve accomplished even when you have basically proofs that shows otherwise. So there are two different links that are related to that. One of them is a really great answer on Quora, which is about kind of like what impostor syndrome is and how we can overcome it. And then the other one is a talk that was recently done in Ruby about impostor syndrome that’s really great that I think a lot of people should watch. I think a lot of people suffer from impostor syndrome, and we kind of guilt ourselves and put a lot more weight and stress on ourselves and not realizing it. That’s a thing that we can overcome. Those are my picks. CHUCK: Awesome. I´ll go ahead and jump in with some picks. My first pick, I went and saw the Doctor Who 50th anniversary yesterday on the big screen in 3D and it was awesome. So just throwing that out there. I've also been listening to a book; it was recommended to me by Eric, and that book is Duct Tape Marketing by John Jantsch. I think that’s how you say it. Anyway, it’s a really great book. It kind of pointed out some of the things that I realized that I did some things that I have improved on, as far as marketing and sales related to my freelancing business. So just really, really awesome book. And that’s all I've got. Pat, what are your picks? PAT: I have a couple. I'm actually deep in to this book right now by Gary Vaynerchuk called Jab, Jab, Jab, Right Hook. It talks about who to tell your story in a noisy social world. So it’s actually really, really good. I've read Gary’s books before. Crush It was a big inspiration for me, but this is a very tactical book that shows images and things of different companies -- companies that we all know -- using social media and doing it right and a lot of them doing it wrong. And how we can sort of incorporate these lessons into our business and into our own personal brands, which I think is really good. And there's another one completely separate topic that I've been really enjoying, and that’s this app called Lift. I think I saw it in another podcast you guys did with Leslie and I just have to reiterate how much that has made an impact on me as a person to create these habits that will allow me to live the life I wanna live. Lift is a great one. I actually had Tony Stubblebine on my podcast and he's a great guy. He really cares a lot about helping people achieve these goals in life through habit creation. So Lift is definitely a big one if you haven’t picked it up yet. CHUCK: Awesome. I keep hearing about Lift. I need to go check it out. All right, well we'll go ahead and wrap up the show. Thanks for coming Pat, really appreciate you taking the time to come and talk to us. PAT: Absolutely. Thanks for having me on. I really appreciate it. CHUCK: All right, we'll catch you all next week!