I Would Be Scared, Frankly

[Music] hello everyone welcome to what is once again the 21 hats podcast I'm your host Lauren Feldman this week we're turning the tables this week I'm the one who is Fielding questions and taking advice that's because as I've been hinting this is the week I explain why we're changing our name again and what it means for the future of this podcast I am now the proud owner of a pre-revenue startup that has a daily email newsletter that we've been giving away for free plus this weekly podcast that we've been giving away for free and the designs for an unbuilt website that we had hoped to one day charge subscription fees for in this episode I ask my guests who happen to be seasoned business owners and also my target market if they have any advice if you've been listening to this podcast it won't surprise you to hear that they do indeed have some advice for me as I say every week even in Good Times owning and running a business can be a lonely Pursuit our hope is that these weekly conversations will if nothing else let owners know they are not alone in facing these challenges this week for me anyway it's personal this week's lineup features Paul DS who is founder and CEO of Paul DS cabinet makers which is based outside of Philadelphia and makes custom conference tables Jay goz whose companies in Chicago include a picture frame business artist frame service and a home furnishing store Jason home and Dana White who is CEO of Pary Boyd a chain of hair salons based in Detroit the the episode is titled I would be scared [Music] frankly so we're going to do something a little bit different this week um for a change you guys are going to get to ask me questions uh which I'm sure you will all enjoy uh this week of all things we're going to talk about why this podcast is going back to being the 21 hats podcast um I'm thinking our listeners will find this convers ation interesting and uh also because I am now the owner of 21 hats and since I'm fortunate enough to do a weekly podcast with experienced business owners who have done who are they when are they going to get on here right after you guys good experienced business owners who have done what I hope to do which is build a business H and who also happen to uh represent my target market the very people I'm hoping to turn into customers I'm going to take this opportunity to tell you what's going on and to throw some ideas at you and see if I can get some uh free advice you guys okay with that great sure so first let me you guys know most of this let me give our listeners uh some quick background uh but all three of you please uh feel free to interrupt with questions or uh booze or anything at any point um background I've spent roughly the last 20 years or so covering entrepreneur and business owners for uh the New York Times for Inc magazine for Forbes two years ago I left Forbes to partner with Adam witty who owns a book publishing company Advantage Forbes books that helps entrepreneurs write books um the idea was to take what I had learned at the times at Inc at Forbes and together with Adam build uh what we hoped would be the definitive publishing company for entrepreneurs and business owners uh in America we got off to a pretty good start uh we have the morning report the daily uh email newsletter that goes out uh first thing in the morning and we scour the web to bring together uh highlights of all the news business owners need to know first thing in the morning and with this podcast which as you guys well know uh has been tracking the journeys of six business owners the three of you plus three others uh through the uh through this whole crisis um the next piece of uh the business that we hope to build was to be a content and Community website a platform that I spent most of last fall working with developers to design uh we got it completely designed we were really happy with it but we never got it built uh we probably needed about three more months before the crisis uh hit so here's where we are Adam and I have come to a very friendly agreement that given the changing circumstances he should focus on what he does u meaning Advantage Forbes books and I should focus on what I do which is 21 hats so the the bottom line is I am now the proud owner of a pre-revenue startup that has a daily email newsletter that has um that we've been giving away for free uh plus this weekly podcast that we've been giving away for free and the designs for an unbuilt website that we had hoped to one day charge subscription fees for any thoughts so far good job congratulations here here yeah I'd be scared frankly don't tell him that part of the entrepreneurial Journey he's got to figure that out for himself hey I've been talking to you guys long enough to know that I should be scared uh and uh you'll be happy to know I am and I'm not sure congratulations are in order just yet uh but yes let me step in here congratulations are in order because business is all about leverage and control those are my two words leverage and control and you have never had control cuz you've always been an employee so for for the first time and from what I can see in your whole life you've got control over your destiny in Leverage is you've got a great base to work off of that you're the only person I know of that has been this intimately involved with small business and have wonderful tight relationships with people you've been there on the front line with them and you're going to now leverage that in the right and proper way that feels right and not have to have a distraction of another entity that has its own needs and desires and agendas and hence the names back 21 hits which ISO love it yeah which is where we're at that's congratulations you're in your sweet spot you just don't know it yet well I appreciate all that I thank you for saying it uh the reason I'm scared is because I still have to prove that people will pay money for what we're doing and I had tremendous confidence that they would pay money for the website had we gotten it built the question now is can I monetize uh the assets that I do have uh including the morning report this daily email newsletter that uh I know the three of you read do you think people will pay for it well here's the beauty of your new business model there's no longer an overhead here and lots of employees and office space that your overhead is so low now that my overhead is my mortgage right so that's what I'm saying it doesn't require turning this into a 2 three5 million business that I believe that there's enough good content that you give out your value proposition I believe is solid and people will pay to get it because it's going to be a very moderate cost and I do believe that you'll be able to quickly monetize this thing I think that people pay for answer and people pay for a map and so if your if your product is solving a problem and or walking people towards solving the problem for themselves they will definitely pay for it let's look at the rest of the marketplace I mean I want to hear from Paul are you pulling out a credit card I know you're my friend you're going to do it but well no I would I would do it on the strength of uh I subscribe to a bunch of papers because I want there to be papers and so um I would subscribe to your morning report because I want Lauren Felman to prosper and the things that you've done over the last 20 years I want them to continue um I mean we don't know what the price is but I presume be something that your average business owner could swing which is great tell us Paul what you think tell us right now before you get tainted hearing a number what would you think this price is going to be I I honestly don't know I would rather since we have the actual source of information available easily why don't we ask Lauren what he say no no we have to ask you first before you get tainted so the question is would you be surprised if it was $50 a month what's your visceral re that seems a little high right okay it's an aggregator at the moment I think that if you if you wanted to charge more than uh let's say $15 a month which sticks in my mind as being about what the Philadelphia inquire across me um you would need to start producing your own unique content and as Dana said that content would have to serve as a map uh and be useful for people and so I don't think there's any reason why people wouldn't pay more for good content but uh um it has to be something that really works for them and it has to be something that they can't get cheaper elsewhere and who's your Market though too that's the other question is your Market the business owner who's you know been in business five plus years 10 plus years 15 plus years who's your Market because that that problem you're helping them solve for and that map looks very different than my map looks very different than Jay's map but but that doesn't mean that the content isn't equally valuable to you and me and Paul you did answer the question Lauren and I have talked about that price you're that's what we were we're thinking 10 20 bucks that's exactly where we were thinking and and you hit right into The Sweet Spot of what seems to be a reasonable number and you you did raise an interesting question you're right that is it is primarily an aggregator at at this point um obviously we're producing uh fresh content with this podcast and that leads to an interesting question do do do I put the podcast behind a pay wall or do I keep it free as it is now my preference would be to keep it free uh if possible uh and produce other types of content uh My Hope though is that the aggregation itself is of value that uh the fact that I scour the web and pull stories together that I think are useful valuable to business owners put them in one place for a quick read every morning well you're curating and and curation is an art form and you have got 20 30 years of experience that most people do not have of knowing what articles are going to resonate and are going to be valuable yeah I think Lauren is uniquely poised to start doing something which is actually quite different and better than aggregation which is to deemphasize the startup world and start talking more about the Main Street world and in the articles that I see in the morning report now there's still this overemphasis on California and raising money and a bunch of stuff that really doesn't feel like my world at all and I think that to wrap it around to you gaining control of this company you are about to I mean you're at a fork in the road where you either try to bootstrap this thing yourself and start listening directly to your clients and figuring out okay what what does that lead me or try to go out and and raise money which means that you're responding to the ideas of the people with the money about what they think is valuable and oh go ahead Dana I mean I think that's enough to chew on actually yeah no and I'd love to piggyback on it as Paul said a lot of the information out there is focused on Silicone Valley and silicone alley which is New York right and it's not about Main Street you have a unique opportunity to talk to the business owner who's been open for five years who doesn't quite understand what to do I've been fortunate enough to be able to speak with Jay and you and listen to this podcast and talk with you guys about my fears and you go oh Dana that's nothing that's just a part of it oh really there are so many business owners out here that don't know that there are business owners out here that are who go it alone and this podcast and The Morning Report can be somewhat of an encyclopedia can be somewhat of a road map and say you know what before let me see if there's a podcast from you know 21 hats that talks about Day One Main Street not day one series a startup you have this unique skill set with all of these years of experience to talk to everybody in every phase of of growing of growing their business one thing I would love to see you talk about is networking my goodness how the idea and the revenue will get you will get you far but if your network isn't where you need it to be and you can do that and that is content you pay for because as an entrepreneur who goes at it alone you will have this this voice in your head this you know the sound in your ear from The Morning Report from the 21 hats podcast saying hey we've been here too I'll never forget I've told the story many times of how I first got to know Paul I he sent me an email in which he suggested that way too much of business journalism was focused on Silicon Valley silicon alley uh highflying Venture back companies and not enough on um you know the the the 96% of other businesses out there and that he was in a particularly interesting place where he he thought his company was going bankrupt at the time and he was willing to write about it because he thought it would be helpful to to other business owners and to me that that's kind of been the premise ever since then trying to create content that would be useful to that type of business and let's get to the 21 one Hat's name what that means I don't know if everybody's thought about it that's listening but that was a very deliberate name meaning 21 hats there are 21 things and that wasn't pulled out of thin ear well it was a little bit but very little there's not 40 and there's not 10 there's about 21 things about that business owners have to deal with about okay give or take five Insurance hiring firing leases employment agreements there's all kinds of things entrepreneurs have to deal with and there's really very few resources to get that really give you the inside scoop on what that's really about I didn't want to pick a name that includes the phrase small business um for all kinds of reasons I think some people are offended by that name uh Jay I know you're not you you includeed in your Twitter handle if if you know you have a Twitter handle oh I have a handle yeah I wanted a name that would show respect that would indicate uh we don't see you just as being small we see you as doing something valuable that is not easy that you can't possibly be prepared to to do all the things you have to do um whether it's 21 or or 41 um and that was to to me the main point behind the name it's also not a buffet that you can go oh of the 21 I'm just going to pick out these eight I don't like or maybe I'll pick out the 17 because the reality is you've got to deal with every single one of those things and you can be gifted at some of them and really good at others and Outsource others but you can't just go oh I don't want to deal with that because that's what could put you on of business exactly here here Jay here here I think the other thing that to be considered uh and maybe this is jumping ahead to a question you're about to ask would be what is the form that this information takes because so far we've got an email a series of emails and a series of podcasts but they're not easily searchable and to me if you wanted to provide value to these smallest businesses it would be to build start building a knowledge base in a way that's searchable so that someone who just joined would be able to say I've got an HR problem you know boom I'm gonna go look at HR stuff y you describe the website that he's been trying to get going yeah that was that was the idea but you you make a really good point and social media social media is huge you can do a 21 hats Facebook group and you could put all of this stuff and they could search for it here's all the post and links and podcasts on HR here's all the post and links about um sales like every everything could be organized in catalog of via social media through hashtags and the website can connect to it there it's it's it's easy and it's endless and it'll it'll really help it'll really help the podcast done that's all yeah there you go that's all you have to do he's got it he to he wrote it down we're done okay great take care of that Lauren go one thing I would point out um I don't think everybody realizes this we do create transcripts of every podcast so you can go uh to 21h hats.com and search a um you know a word version of of the podcast and uh look for topics that you you know that you want to focus on if we were sitting on an airplane next to each other and you told me what you were working on I would immediately say you know what it doesn't sound like what you're doing is going to require a zillion the second you try to raise money a that's a whole job in itself you're back to having a boss so I believe you can pull this off without taking any investor money and by growing it bootstrapping it and having control over it because you don't have any huge financial burdens that you've got to do and the second you take money from someone it's a game Cher and now someone could say oh Jay you're thinking small maybe I I I call it thinking medium I've seen enough people thinking big that ended up giving away their business or having nothing but grief that thinking medium works really well for me you can make enough money and have control over your life it's the small giant model I think you're thinking today yes which is fine right I don't think you're thinking small I think you're thinking today today I don't believe Lauren needs an investor I mean if it comes along you know that might be something that he might set up for himself for the future but today he just needs to establish himself you know have a strong social media presence you know um analyze his numbers and figure out you know how to Market to get those numbers higher if they're not high enough I do like the idea of proving the concept be before taking money um seeing if I can get this thing to work prove that it works and uh and then if uh if there's an investor that makes sense consider that although uh I'd be perfectly happy never to go down that road if if possible there are now platforms the the best known one is called substack that uh handle the backend of an email newsletter uh substack is particularly popular among um journalists who've been laid off who have something of a following want to build on that following and and monetize it without having to hire uh a tech person or develop te those kind of tech skills so uh with a platform like substack I can bring over we now have about 5600 uh subscribers to the morning report I can bring those over to substack and they will instantly make it possible for me to uh to start charging if uh if I so choose they they encourage you to believe that you are likely if you try to convert uh to a reasonable price you're likely to keep uh somewhere between five or 10% of your uh subscribers as paying subscribers and uh if I were able to do that I think that that would give me uh the start uh that would give me something to build on can I comment can I jump back to what we were talking about just before that which is Jay's comment that that you want to think medium um I would actually warn against thinking too small because that's a trap I've found myself in for many many years that how do you mean Paul I just focus on what's in front of me and react opportunities that come along and I've never really had a Grand Vision for the company and I think that it's it's been a problem to a certain extent that I didn't have anything any flag on the horizon that I was heading towards so it's not that I had a grand plan but to what you just said but I did see a flag on the oh wait I can do that so I did continue to expand so I'm right there with you I think yes you need to look at what opportunities are out there but I think thinking medium is a is a great place to be let me bounce this off you I I do think it's useful to drop in the occasional item um about that other world the Silicon Valley world just to remind people of the other path that is out there and and sometimes frankly it's done to kind of make fun of it last week we talked a little bit about magic leap that company that raised billions of dollars and and fell flat uh sometimes it's done just to to make fun of the other approach that exists um I think that's worth doing what do you guys think no here's here's here's my take on it so the way business journalism in general works is responding to the human desire for a happy Fable and uh we know that that most of this content just focuses on people who are outlandishly successful because there's something in our minds that just responds to that that's the junk food of of the business information economy and it's taken over pretty much everything and one of the reasons why I challenged you to think big is because I think that there's actually an enormous opportunity to provide really filling nutritious information to a really large group of people which which is people who are thinking of starting businesses or just started businesses or are in the let's say under 20 employees or under million and a half phase because the that's where the real danger uh of failure lives is is is most um is most pressing to the people who would use your content and I think that it's worth asking the question like what good is it when somebody starts a little business business like Dana or me and it fails like who who benefited from that and the ordinary tropes of business journalism have nothing to say to that entire audience and that's a big audience so that's what I was speaking about when you know I said what I said earlier I would love to see the 21 hats podcast and The Morning Report be a tool in the the toolbox of a new entrepreneur or someone who is in as Paul said that that that zone of oh this may not work or it may take off um because again we don't have that I guess my other question for you is and we may address this at the end but how can we help you know number one like how can we help as you know members of this podcast to to launch to help you launch and you're already helping Dana yeah um but I I guess my two cents on the numbers would be to you have the fif you know the five five or 6,000 I would grow it a little bit more before I charged I would I would I would grow it as just 21 hat I would grow it in this organic space of it now being yours and grow it a little bit more and then say so I guess the question is when when are you thinking about you know charging for it and I would just say hey go a little bit more before so in entrepreneur terms Lauren since you're new to this that means take your charge card thing till it's almost at the limit but not exactly there almost and that's when you uh pull the trigger charge yeah get that charge card balance up they're a little bit higher not I think that's terrible advice not D stay the hell away from Char you know what you've be as they said in Rocky 3 you know what you've become civilized Paul it happens to all great Fighters you become civilized you got to get you got to take some credit some debt on we talked about this last week Jay told us that he Jay told us last week that he has always borrowed against his house and Paul you've told us previously that you have not done that that's kind of the Crux of what we're talking about here frankly I would love to do this without borrowing against my house and I'm not sure you have to because I don't think you have the requirements that you're going to need but but I think and there's not a right or wrong to this it's that I would rather borrow against my house and save my business and grow it than have the business go broke but know that oh well the house isn't being touched so it's it's a different mentality it's a different and and I believe my mentality is why my business has gotten to the size it is but I am certainly not uh doing well I probably have been Reckless on hindsight but at the moment I've I've gotten over the Reckless thing I'm not betting the house I mean I've got enough Assets in the business that I'm not going to be losing my house so there it's a it's a balancing thing I think debt is translating for him as risk yeah and every entrepreneur needs to be able well d depends on how long I follow your advice it's how long I go without charging um will determine how much debt uh I run into are you comfortable with taking the risk and that's it how how long are you comfortable without charging she's got a great point about priming the pump some more like get a little more going here before because I think that's a smart thing like you know what I kind of disagree with that too I mean you you guys have you've got what you said 5600 yes okay so you've got it I the first question I would ask is what's the trajectory on this if you contined to do it exactly as you're doing right now would it continue to grow or have you plateaued and the second thing is What mechanisms have you established to hear from those people uh so that if the content that you've been kicking out in this podcast are like they're okay and people like to listen to them for free but if it could do X it would be worth money to me that's a question you want to be asking a lot of those people that's a great question Paul you should but let me just finish you should not I don't think you should be be shy about charging right now as long as you make it clear what people are buying which is the continued existence and growth of this information Channel which is already I think unique but uh with the opportunity to become even more unique and and useful like if you had zero listeners and you had to char the very first person to to sign up that would be a tough lift but you got here already like I wouldn't undersell uh the possible commitment of the people who are already following you I want to address something Paul said um one of the great lessons I learned working with you guys at the small business blog at the times was that it wasn't just about the content that we created um it was about the conversations that we created and it was Paul you were especially good at this you you would occasionally just put up a post that said something like here are the three problems I'm facing this week people would devote an inordinate amount of time to trying to help you with whatever problems you uh flagged and they did I should just put that out I mean we've left all the people who are going to listen to this podcast out of the conversation so far well hey to those people uh I say first of all thank you on the behalf of Lauren for for listening but second of all my experience in the times really changed my life because it was the first time I had opportunity to First access other points of view but second to get feedback and that is incredibly valuable and Lauren if you can build a mechanism that allows people to as much as possible participate in that kind of experience it's definitely worth money that would be part of what people would be paying for on day one on one of these platforms so for every newsletter uh I could ask questions I could ask people you know something comes up like in a podcast where you guys are talking about the merits of borrowing against your house we can start a conversation about that and people could weigh in it would make this a much more interactive process and something that I think would make it much more valuable to people so Dana we didn't ask you how much were you expecting to pay for this oh brother um $10 a month okay let me make a point I'm I'm you know not the baby but I'm the youngest business owner here um and some of the people that I know that have listened to it the content is something that they say for later right not that they don't listen right away but it's not necessarily affecting them today a lot of the business owners that I talk to they're finding that the Morning Report hey guys this is what's going on out there and what's going on out there isn't necessarily affecting what's happening right here and so that's why you know my advice comes from the two cents that I've gotten from the business owners I know that I read and listen um even from employees that read and listen right you have an opportunity for people who want to own a business to paint that picture and communicate on that level you have an opportunity for people who have been in business one to five years and and so on so that's what I would like to see now that this is your baby Lauren is crafting that message a lot of times when we're listening to the people on the show like Karen and William and Jay and Paul that have been in business for a long time you all speak as if you've been in business for a long time because you've been in business for a long time um and so it and sometimes you're not disconnected you do remember and you do talk about what it was like day you know 17 but um you're you're removed from it you're no longer in it so as far as Lauren making decision I do believe that the number is between 10 and $20 it's clearly in my mind it's clear to that 30 let me clarify one thing that I think we we may have blurred the lines on which is that I do have the option of figuring out what people pay for and what remains free and the the direction I'm leaning in at the moment is leaving the podcast free and available wherever people get podcasts while charging for the Morning Report um and so that's a way of bringing in new people uh who will find the podcast on Apple or through Google or Spotify um but uh trying to convince them that the morning report is worth paying for at the same time how much would it cost to to finish out the website so that you could have some kind of interactive Community um you know my favorite model is Reddit because it allows for self-editing by the audience in terms of the up voting of the comments and uh but to me that would be the thing to charge for that was the original plan and I certainly don't disagree with that I it's it's not a ton of money it would certainly be less than $100,000 we had a deal to to do it for uh about 60 I don't know whether that would still be there or not does substack have any of those features let say you build a following do do they also give you tools to build a community around it um not not in the same way we envisioned we envisioned on this website and designed it so that anybody who registers creates a profile page so people can learn about them and and about their business it requires people to register with their real name to give a little information about their business what industry you're in where you are uh some sense of the size um and then we were going to have kind of um you know forums or sort sort of like slack channels by topic by hat uh so that you know for example during the crisis uh when everybody was focused on figuring out what was going on with the PPP loans we would have had a channel there a forum there where people could uh share information and I think that would have been incredibly valuable that's not available on subst I think this is where you do a little research and don't reinvent the wheel guys um I was planning on giving you you a morning report news quiz um but I was getting too much good information listening to your suggestions and we've kind of run out of time I hope you're all okay with that oh man thank you for this uh this has been a very different experience for me having this conversation uh and I think it's you know the first of many different experiences for me I appreciate having all of you to call on it's been um it it it's been great getting to know you for years and to know that you're here asking what you can do to help um is going to I think help me uh get some sleep one of these nights okay so the first thing you do now before the world finds out that you're not gainfully employed is call your credit card company and get your limit raised little entrepreneur tip oh yeah that might might end my marriage but uh I'll take that under advisement well that's assuming she knows about it that's you know part of the I want to thank you Paul DS Jay gz and Dana White more than ever really appreciate this thank you and congratulations on the on the new start this is awesome yeah you're one of us now when do you become an entrepreneur when you start a business or when it actually is a business anybody uh you become an entrepreneur when you Frid yeah when you when you walk away from the paycheck guys thank you very much have a great week thanks for listening everybody this episode was produced by Jess thubron founder of blank word Productions remember we started the 21 hats podcast to help business owners feel a little less isolated to let them know they aren't the only ones fighting these battles if you got something out of this conversation please help us reach more people tell a friend subscribe and review us wherever you get your podcasts follow us on Twitter at 21h hats and let me know if you have a question or a comment or a topic you'd like us to cover my email address is L Feldman 21h hats.com see you next time [Music]