Example #1–
Helping the boss develop new products
Approaches used:
1. Do what you already do better
2. Develop a new skill or competency
In 1983, Michael Masterson was working as an editorial assistant for a printing company. He decided to study how the company marketed itself and got closely involved in helping the owner build his company’s turnover. In recognition of that involvement, Masterson was promoted to head up the editiorial department. That meant his salary increased from $35,000 a year to $70,000.
Six months later, Michael came up with an idea for a new and better type of financial newsletter. He approached his boss, explained that he’d been working on this new project in his own time and said that if his boss liked it and decided to go ahead with it, Michael wanted to have “a piece of the action.” His boss was reluctant at first, but ultimately agreed to give him a 25-percent stake in the new publishing project.
That was fine, but to bring the circulation of the new newsletter up to where it needed to be was going to cost about $2 million in marketing expenses. To suport his 25-percent equity stake, Masterson had to mortgage his house, sell his car and put everything he had at risk. Eventually, he owed almost $500,000 before the newsletter started to make any profits.
Within a year, however. the newsletter had turned the corner and was starting to do well. Just a few months later, Michael Masterson’s 25-percent stake in the newsletter was worth about $1.5 million.
Example #2–Finding a Partner
Approaches used:
2. Develop a new skill or competency
3. Supplement your income
Alan Silver was a successful self-employed businessman who made a good living selling office supplies in Boca Raton, Florida. When Office Depot and Office Max came into his home market, he decided it was an opportune time to make a career switch. A friend of his named Rick was a newsletter publisher, and Alan teamed up with him to start a joint venture company that would sell natural supplements to the newsletter readers. They formed the company on a handshake and agreed to split any profits that would hopefully be generated 50-50.
Alan wrote a 4-page flyer that would be inserted into his partner’s health newsletter. He then arragned to insert it into some other newsletters on a 50/50 basis where he would split the sales revenue generated with the publishers of the other newsletters. The responses to the ads came quickly, and within six months the new company had generated more than a quarter-million dollars in sales. It was only at that stage Alan learned that to allow his business to grow, he had to plow everything back into the business for the first serveral years at least. In addition, other vitamin supply companies were starting to use the same advertising approaches he had used, so the market was becoming much more competitive. Alan spent a few hours every day learning everything he could about the health supplement industry.
In order to differentiate his company from the competition, Alan and Rick teamed up with a doctor and started developing their own high-end, high-quality nutritional supplements. His marketing now emphasized the superior quality of his products and the company started making more sales. Alan also developed an entirely new product–a multivitamin packaged in an aluminum cannister. Inside were packets of the five or six vitamins most people take every day. Customers could just open the cannister and grab one packet to take in the morning and another packet to take in the evening. It was convenient and unique.
Example #3–Branching out into other fields
Approaches used:
1. Do what you already do better
3. Supplement your income
David Keller is a doctor with his own medical practice. While to many people that may sound like a license to print your own money, the reality is that increased government regulations, HMO reporting requirements, malpractice insurance and other administrative obligations now severely restrict the amount doctors can charge for their services. To compensate, Dr. Keller ended up working 10 to 12 hours a day, seeing 90 or more patients during that time.
Dr. Keller soon realized he couldn’t grow his business by seeing more people himself. He was already becoming exhausted and had not been able to take a vacation for the five years since he set up his practice. He was interested in some alternative medicine treatments that seemed to be generating better results than the conventional protocols he had learned in medical school. Dr. Keller did some more research on the topic and decided to establish his own consulting company to provide services to the maanufacturers of these nutritional supplements and to the marketers who were welling those products. He also began consulting with insurance companies, teaching them how to cut costs by improving the health of the people they were insuring.
Although his total income during the first year of consulting was only $20,000, by year five he was generating more than $400,000 from his various consulting activities. He used that revenue to move into real estate investing, publishing a natural health newsletter and selling information products over the Internet. Dr. Keller also worked to provide more education about new services and new lab tests to his patients. That allowed him to gradually increase his charges while at the same time keeping his patients happy because they were receiving better treatment options all the time.
As his medical practice grew in sync with his sideline consulting business, Dr. Keller was able to hire and train more staff. He cut back his own workload to five hours a day, three days a week so more time could be devoted to both his consulting business and his family.
Example #4–From partnership to entrepreneurship
Approaches used:
2. Start a side business and grow it
3. Invest in real estate
Brad Solomon was a 27-year-old accountant in 1998. He met someone who convinced him the time was right to start an investor-relations business. This was natural extension of the kind of work he did as a corporate accountant, except it would also require that he learn how to write good public relations material that would appeal to potenial investors.
To get started, Brad contacted someone who was already active in the financial publishing industry. Since he had more business than he could handle, he agreed to contract some of the more mundane aspects of his work to Brad. That worked out fine because it gave Brad the confidence to quit his job as an accountant and plunge into building his own company. The arrangement worked fine for a year or so until his client accidentally e-mailed Brad an invoice he was sending to his client. When Brad realized the other company was taking his bills and then doubling or tripling them for their clients, he realized there was much more money to be made if he dealt directly with the end clients himself.
To build his profile, Brad started attending trade shows and industry conventions where he handed out his business cards. He also offered to do a few jobs on a love-it-or-you-owe-me-nothing basis. Gradually, he started getting clients and since he delivered more than they expected, he started generating some good word-of-mouth referrals. Within a year, he was regularly billing $10,000 to $20,000 per month. He then hired his first employee in 2002 and taught him how to find new clients.
To add another revenue stream, Brad then decided to start publishing an investment newsletter. He also started another business with his cousin to provide specialized healthcare workers. Brad agreed to put up the start-up capital and have his cousin run the company. By a stroke of luck, this industry was just about to enjoy some explosive growth and the new company literally took off.
By the end of 2004, Brad was making $400,000 a year from his investor-relations business and newsletter. He also made another $250,000 as a silent partner in the healthcare workers business. Brad started investing that money in small-cap stocks and real estate, where again he was fortunate to be coming into both markets when they were on the upswing.
By the time a large temp agency made an offer to acquire the healthcare workers business in 2005 for a very healthy price, Brad realized the value of all of his investments were rising rapidly. In fact, he ended up making around $2 million within three years just from his investment portfolio and the sale of his sideline company.
Example #5–Using sales skills to start a business
Approaches used:
1. secure profit-sharing packages
2. Start a side business and grow it
In 1975, 18-year-old Bruce Buffer got a job selling office supplies at a 50-person company. Within two weeks he was the company’s number one salesman and within three months he was promoted to sale manager. He was earning $50,000 a year, but he could see the coompany was earning a lot more from his efforts, so he quit to start his own business. That was fine, except his previoius company hit him with a million-dollar lawsuit because he took their best salespeople with him, so Bruce returned to work for his previous employer for twice his salary plus a bonus.
By 1993, Bruce Buffer got the entrepreneurial bug again. He already had a couple of part-time ventures going but he also wanted to help commercialize the success of his half-brother, Michael Buffer, who was a ring announcer for boxing matches who had the trademarked signature phrase: “Let’s Get Ready to Rumble.” Bruce and Michael decided to form a partnership to generate income from that phrase.
Within three years, Michael Buffer was not only acting as ring announcer for boxing matches but also doing the same for the NBA, the NFL, WCW Wrestling, the NHL, the Indy 500, NASCAR and the MLB World Series. Bruce even came up with the idea of using personalized audio recordings of Michael for other events so they could generate more revenue without being imited by Michael’s in-person availability.
By 1999, Bruce and Michael working together had generated more than $400 million in sales. Michael even managed to negotiate one deal that saw him become the voice of the Ultimate Fighting Championship (a martial arts tournament) because Bruce was contracted to a competitor, the WCW Wrestling League.
Example #6–Writing a success story
Approaches used:
1. Secure profit-sharing packages
2. Start a side business and grow it
3. Invest in real estate
In February 1999, Justin Ford declared bankruptcy. He had tried starting his own import-export business and then building a publishing business, but all his efforts had come to naught. As he had a wife and three kids to support, he looked around for something he could do to make end meet. The only job on offer was to become a copywriter to develop marketing materials for another publishing company. Justin didn’t have any experience in the field, but with no other options he interviewed for the job. The publisher liked him and offered him a job with two salary options: Justin could take a starting salary of $60,000 a year or he could work for the company on a freelance basis earning the standard rate for freelancers plus a royalty on the sales he generated. Justin opted for the freelance position.
Within a year, Justin’s income had doubled to around $200,000. About half came from copywriting fees while the other half came from the performance-based commissions he was generating as a marketing consultant. It was at about this stage that he came up with the idea to develop a program called The Seeds of Wealth, which would teach children how to save and invest money. Justin developed all the sales materials for his program and then approached a successful businessman to offer a 25-percent stake in The Seeds of Wealth for $25,000. The businessman loved the concept, was impressed by the marketing materials and made the investment.
With his new idea launched and solid success as a copywriter, Michael had managed to save $30,000 by the end of his second year as a copywriter. He used that money to buy a piece of real estate that turned out to be a very good investment. He would be able to resell his property for an additional $85,000 within a couple of years.
By 2005, Justin had four income streams in place:
He generated a six figure income writing advertising copy. This took between 30 and 40 hours each week.
He also earned a six-figure annual income acting as a marketing consultant. He spent between 10 and 20 hours each week on this work.
He had a property portfolio that generated a mid-five-figure income for him each year.
He also had a modest but steady income which rolling in from his Seeds of Wealth program with almost no investment of his time.Learn more about Michael Masterson’s philosophies from his book Seven Years to Seven Figures.