While I am not trying to discourage you from starting a business, I just wanted to put the facts on the table.  You will hear many publications speak of businesses failing, but what happens to the entrepreneurs after their business fails?  You don’t hear a lot about those situations, but we’ll talk about it today.

So, your business has failed, so now what?  Chances are that you are suffering from a potpourri of emotions including disappointment, anger, fear, sadness and maybe some depression.  While I speak so much on this blog about keeping emotions out of the business equation, when your business fails you will be feeling a whole bunch of them.  Realistically no one likes to lose and in these cases you didn’t win, right?

Recovering from a business failure can be a long or short road depending on many factors including:

1. Length of time that you were in business
2. Magnitude of the failure
3. Depression
4. Emotions
5. Circumstances of the failure

When I look at the instances where my businesses have failed, I really have used the time to learn about the events that lead up to the failure, changes I could have made and signs that I missed reading.  I look at is as an educational experience where I had the opportunity to really dig into what happened and extract some nuggets of knowledge.  From my own experience there are five steps to recover from business failure.

1.  Grieve

Just like losing a loved one there is a grieving time for a business.  Sure, we don’t have a funeral to commemorate the great times we had, but the truth of the matter is that you had a lot invested in your business.  If you are like most entrepreneurs chances are you poured your heart, soul and life into the business to make things happen.  It was something that you had on your mind whether you were working, at home or on vacation.  In many respects your business would have been as important as any other family member and I bet it was hard to see it go.

So take some time to grieve over the loss of your creation.  This might mean taking a break, getting away from home, or just having some time to reflect on your life.  By taking this time you give yourself the opportunity to digest what had happened and how you will move on in your life without your business.

Take as much time as you need but I would also advise that you don’t take a long time for the grieving process – you will still have a life that needs your attention.

2. Learn from your Mistakes

The one positive thing that you will benefit from because of your failure is the opportunity to learn from your mistakes.  By examining your business and what lead up to the failure you can gain some valuable insights as to how you can run a successful business.  The experience gained from this process will be invaluable as you move forward and create your next business, though reflecting on what happened can be tough.

In order to get the most you can out of this experience you should try to stay emotionally detached.  Ideally we want to analyze things as mechanically as possible and emotions will just cloud the wisdom you could gain from this process.

It is also important that you go through this process as a means to learn and not an exercise to blame circumstances or people for the failure.  Placing blame is not going to benefit you at all and irrespective of why the business failed pointing a finger at someone or something isn’t going to benefit you at all.

3. Pick Yourself Up

Many people who have failed at business have had their faith in their abilities shaken.  This can put them in a position where they feel scared to try again.  But I suggest that you take a look in the mirror.  Do you see what I see?  The entrepreneur that has a passion to succeed.  Sure, your last business venture didn’t quite work out, but that doesn’t mean that there isn’t another opportunity out there that you will excel at.

The truth of the matter is that I can’t tell you that you can do it again – you need to believe it.  For myself all I had to do was look at some job wanted ads to remember why I chose to be an entrepreneur in the first place – I wanted the freedom to choose my own destiny and provide for my family in a way that didn’t make me a slave to a 9-5 job.

So take a look in the mirror and do what you need to do to remind yourself why you went on the crazy journey of being an entrepreneur in the first place – when you do remember, you will be charged up for your next venture.

4. Try, Try Again

I suppose the last step here is pretty obvious, but take your new found wisdom and drive and start something new.  This doesn’t mean that you have to start a huge business, but get out there and just do something.  The ideal project would be something where you can have some kind of measurable milestones that are attainable.  Each time you achieve one of your goals you will find that your confidence will increase and your drive will as well.  For myself, each goal I achieved only fueled my drive that much more and reminded me that running a business can be fun and rewarding.

As entrepreneurs we are driven to succeed in business but sometimes those businesses fail.  But in these instances we can find opportunity to grow and gain experience to help us on our future endeavors.  The recovery process takes time as we grieve, learn from our mistakes, remind ourselves why we are in business and strike out to try again.  In the end these failures can be positive milestones in our entrepreneurial careers – they are not the end of the road as they are merely speed bumps on our journey.

No matter where you live there will be properties in tax enforcement.  You will find a wide variety of properties from run down homes to mansions that are in some stage of tax enforcement.  There are a multitude of reasons why these properties end up in this situation including lack of interest on the owner’s part, financial difficulties of the owner, and even in some cases the owner has passed away and the estate has not dealt with the property yet.  Whatever the reason, these properties give you the opportunity to invest in real estate potentially at a fraction of the property value and can make good candidates for both investment properties and opportunities for a quick flip.

Ideally, you would be able to pick up the property for the price of the back taxes, but in many cases you will still have to offer them something for the property as well.  It pays to gauge their need and desire to get rid of the property to make a reasonable offer that will make both of you happy.

When you are approaching the owners of these properties you need to make sure that you are contacting them to help alleviate their problems with back-taxes and not there to take advantage of their situation.  In most cases they will be happy to have someone there that will help relieve the stress of being in tax enforcement and this makes the sale of their property mutually beneficial to both parties.

Even though this might just seem like a piece of cake once you do get the owner on board with the idea to sell their property to you, it isn’t.  Just like any other property you still need to do your due diligence and get all of your ducks in a row before committing to buying the property.  Don’t be blinded by the potential profit that you will be making from the deal – remember that you should be looking at all of your real estate investments without emotion.

While this is not a complete list, it will give you an idea of some other things that you might want to consider before committing to buying a property that is tax distressed.

1.  Check out Existing Liens

Depending on where you are buying the property it may have one (just the tax lien) or more liens on the property.  Ideally you would like to find one where there are no other liens against the property but it won’t always work out that way.  Make sure you know what obligations you will be assuming before committing to the purchase.

2.  Utilities

Many of these properties may have had their utilities shut off for an extended period of time which may result in additional costs to have them reconnected.  Be aware that some of these costs will include reconnect fees as well as inspections (for example, if the power has been shut off for an extended period of time you might need an electrician to inspect the wiring).  Be sure to factor in those additional costs as well when doing your analysis.

3.  Building Inspection

While you might usually be brave enough to skip the building inspection it would be a prudent course of action to do one in these cases.  If the owner has neglected paying their taxes there is a good chance that they may have neglected to maintain the building as well.  Many people would make the inspection a condition of their offer and it would be money well spent.

4.  Zoning

While zoning might be a typical thing you check into when looking at an investment property many investors skip looking into it altogether.  Check with the municipality as to what the property is zoned as to ensure that your investment is a good one.  You don’t want to end up in a situation where you are not allowed to develop or renovate the property in any fashion – you are looking to make money from your investment, not lose it.

5.  Get a Lawyer Involved

When you are investing in these properties, you want to make sure that you are covered and not met with any surprises after the sale.  By hiring a lawyer, you will be able to ensure that you haven’t missed anything and hopefully will allow the whole transaction to go through stress free.

So, if you haven’t looked at properties in tax enforcement as investment vehicles, you should take the time to check them out.  It is a great way to add properties to your portfolio at a deep discount and they can provide a great return on your investment whether you are looking to hold them as investment properties or flip them quickly for a profit.  Just remember that there might be a little more due diligence involved when making your buying decision, but it will be time well spent.

But when it comes to websites, there seems to be two camps: one that is concerned with providing a beautiful site and a great first impression, and the other where their website is just there to make money.  Unlike the real world, the look of your website doesn’t necessarily have anything to do with people ending up there.  Sure, an ugly site might make someone want to leave right away, but the content of a website has more to do with getting traffic than the looks.

If you are on a smaller budget, it makes more sense to invest your money in the content of the website and the looks of it later.  If you notice, this site has great content, and though I think that it looks okay, it certainly could use improvement in how it looks.  But it works for the user, and makes money, which really is the goal of this site.  It isn’t here to make you cry and think “this is the most beautiful site ever”.

Now, I am not condoning that you make something really ugly such as those sites that you always saw back in the nineties that had blinking and flashing text.  What I am saying here is that as long as you make an effort to provide great service to your customers, have your products available with an intuitive shopping cart system, and provide relevant information, in the big scheme of things looks don’t matter.  The site will still make money.

But when it comes to the online space, there initially seems to be little in the way of established business models you can buy into.  Sure, you could buy an established website and in many cases that can launch you into a position where you have an immediate return on investment.  There are also chances of the business failing as well, but that is the same challenge you would face if you were buying a brick-and-mortar business as well.  Buying these proven properties can quickly add revenue to your business and with the small investment that you need to get started (typically in the 6 to 20 month earnings range), you can recoup your investment quickly.

There are other options available to you as well.  Instead of buying an established business, you could clone an existing one.  This can be done a little easier online, but there are many examples where this can be done in the “real world” as well.  When it comes to cloning a real world business, you will find that unless you know their business intimately, you will have to do a lot of testing, base your projections on some educated guesses, and evaluate the results.  This method of creating a new business can definitely be profitable, but there are also pitfalls as well.  When you consider that a business can appear successful but really be in financial trouble, the thought of cloning a real-world business does pose a lot of risks.

Cloning an online business also has its own share of risks and rewards.  In this case, the financial risks are usually a lot smaller and there are more resources at your fingertips that you can utilize to research your competition.  I will get into this subject in a future post and share my methods of finding, researching and duplicating online businesses.

Working with proven business models not only help you to reach success with your business in a shorter time frame, but they can also reduce the amount of stress that comes with creating a whole new business.  By following a proven model, you should be able to succeed in a shorter period of time, but just like any other business venture, there still is an element of risk.  So, the next time that you are thinking of starting a new business venture, take a look at the franchises that are out there as well as your competition – you might find the inspiration that you need to start your next business.

One of the problems that I have been plagued with is interruptions from my children.  Our children are not that old (8, 5, and 3), so they quite often barge into my office unannounced putting their needs and questions first.  This has caused me to lose my train of thought and to have decreased productivity during the day.  This has meant that I have had to accept that I won’t get much done during the day while they are awake and I have changed my business hours accordingly.

But if you really want to operate a business out of your home while you have children at home, consider the following five ideas to make your business and parenting a lot smoother:

1.  Have an Office with a Door

One of the easiest ways to show your children that you are at “work” is have a door on your office.  The reasoning behind this is that they will associate you needing to work in your office as your job, and your time outside of the office as their time.  Granted, this association won’t be made overnight, but as the children grow up, they will understand that you work too and respect that space.

An added bonus to having a door on your home office is that you can separate your family life from your work.  When you are done work for the day, close the office door and focus on your family – those business ideas that you have been working on can wait until tomorrow.

2.  Have Set Work Hours

One of the biggest temptations that I have had working at home is that I can “go to work” whenever I want.  This can be extremely convenient especially those nights where you might be suffering from insomnia, but can also blur the lines between work and family.

Typically kids understand that their parents go to work and then come home to spend time with them.  By setting work hours you not only ensure that you will have some time set aside to be productive during the day, but it will also help the children understand that there is some importance to your business.

3.  Work While they are Sleeping

If you are truly serious about your business it is very important to get some time where you can work without interruptions.  But if your children are little, this can be very difficult as they won’t understand that you need to focus.

For me, I have found that I am most productive while my children are sleeping.  This doesn’t mean that you have to stay up until the wee hours of the morning or anything like that, but it really gives you two good time slots:  at night after the kids go to bed, or in the morning before they get up.  Your choice will depend on whether or not you are a morning person or not – personally I work better at night.

4.  Get Enough Sleep

I find that the one thing my business and kids can do to me is take away the time I need for sleep each day.  A little bit here and there is ok, but the side effects from lack of sleep can affect your family life and your business.  I find for myself that the less sleep I get each night, the less patience I have with my children and customers.  The last thing you want to do is something that would affect those aspects of your life, so make sure that you get enough sleep.

If your children are little enough to still take naps, consider taking one yourself.  This can be a great way to get an extra hour or two of sleep in each day without affecting your business hours.  Don’t feel guilty that you are taking time away from the business for your nap – you’ll be more effective when you are back in the office.

5.  Take a Break

The one thing that most of us entrepreneurs are guilty of is being workaholics.  I know that sometimes I put in very long hours to get things done.  Sure we reap what we sow, but there comes a point where there are diminishing returns – we all get tired out.

Make sure to take some time for yourself outside of the office and your family.  These breaks don’t necessarily have to be very long, but they need to be time spent to recharge your batteries.   It can even be as simple as going to a movie, eating out for lunch or just going for a walk.  The key here is to get out of the office (you don’t want to become a hermit), see the world, and possibly get inspired.  For me, it helps to recharge my creativity and patience and has a whole really benefitted me in all aspects of my life.

If you’ve made it this far, I congratulate you – I don’t usually write posts this long.  But the truth of the matter is that this subject is near and dear to me.  Take the above ideas and apply them to your life and situation and I assure you that your life and business will be much better and more rewarding as a result.

But just this past week while on a business trip, my four year old decided that she wanted to spin around on my office chair.  I am sure she had a grand old time, but it didn’t last long.

You see, she knocked my computer over, which in turn made my headset smash on the floor and break too.  Thankfully the damage wasn’t any worse, but it certainly could have been.

Needless to say, I learned a valuable lesson this week, and you can learn from my mistakes.  I took for granted that my home office was safe from my kids, but based on my experience, I was wrong.  So for you entrepreneurs out there that work at home, take a second look at your office and make sure it is child-proof.

Some simple things that you can do to protect your home office from your children are:

1. Put a lock on your office door and keep the door closed and locked when you are not there
2. If you don’t have a door, get one.  An alternative to a door could be something as simple as a baby gate, provided you have a doorway into your office
3. Teach your kids that it is important that they don’t go in your office while you are not around
4. Put any breakable items away when you are done for the day.  This can include breakable items on your desk, computer headsets, and your MP3 player.  If there is a possibility of it getting broken, then hide it.
5. Make sure your spouse understands that the kids don’t belong in your office.  If they don’t, they may not pay enough attention or discipline the kids when they are found in there.

Even though you may make every effort to keep your children out of your office, there will always be a chance that they get in there anyway.  But by taking the right precautions, you reduce the chances of them doing any damage.  Think of child-proofing your office as risk management.

Some of the most common examples would be the Christmas shopping season from September through to December which applies to retailers both online and offline.  Another good example is the season that we are in right now in North America – back to school.  If you are a retailer (online or offline) that sells school supplies, clothing, or computers, your income should be up right now.

The point is that if you know what customers are looking for a different times of the year, you can setup your business to take advantage of what you know, and offer the appropriate products at the appropriate time.  Most industries have seasonal trends that you can take advantage of, and if you don’t know what they are, you should ask your customer – they will usually tell you exactly what they are looking for.

But you also need to make sure that you are prepared for the dips in spending (or revenue) during the slow seasons so that your company isn’t forced to shut down.  A good example of these types of trends would be college students using proxy sites.  During the summer when they are not in school, traffic to these types of sites pretty much disappears.  But, during the school term (September through April), these types of sites do very well.

So make sure that you are aware of seasonal trends in your business.  Be sure to take advantage of the busy seasons where you have the opportunity to increase your profit, and prepare for the slow seasons to ensure the survival of your business.  If you follow this advice, your business will have a very fruitful life now and into the future.

So, I have decided to purchase an Asus EEE PC which is a netbook computer.  If you aren’t familiar with what a netbook is, you can think of it as a really small laptop (10” screen in this case) that has exceptional battery life (up to 9.5 hours on the one I bought).  Now, being that it is a smaller computer, for some people, typing on the keyboard could be an issue.  So far, I am doing alright on it, though my typing speed is far from what it would be on a regular computer, but it looks alike it will just take a bit of time before I can type on here just as fast as a regular keyboard.

Anyway, the sole purpose of this netbook is to help me to get work done without distractions.  This means that I won’t be installing games, an email client (though that certainly could be a good idea for most people), or other applications that would diminish my ability to get work done.

It also means that at the end of the day, I can shut off my computer and leave work for the day instead of knowing that it is always there on my desktop.  Though this is just the first few days of trying this out, I’ll report back to let you know how effective (or ineffective) it has been having a dedicated work computer.  I think the results will be very positive.

But is hosting your websites with just one company smart?

This is a question that I was faced with this week.  You see, I have a number of my sites spread out over a variety of servers, but that is most because of the SEO benefits that I obtain multiple webhosts.  But, the bulk of my sites have been hosted on two VPS (virtual private servers) machines and account for about 90% of my online income.

The reason that I went with VPS hosting was that some of the sites (for example my proxy servers) require more power than a typical hosting plan.  But with the extra power, comes extra space as well (that proxy websites don’t need), so I figured that I could use the extra space for my other money sites.

This week though, both of my VPS machines went down and I proceeded to contact my hosting company, only to get no answer from their support department.  It meant that this site was down as well as 800 or so of my other web properties and I was losing money by the minute.  At this point, there was only one question on my mind:

Is hosting with one hosting company smart?

Well, in this case it sure wasn’t.  To go from making money to making next to nothing at all isn’t a good business position to be in.  Sure, they were able to get my hosting back up nearly 24 hours later, but frankly that isn’t acceptable at all.

So, I have had to reevaluate my thoughts on hosting everything with one company.  After this weeks experience, I have decided to spread out my website network so that if one host has problem, I still make money for the day.  This might mean a bit of an inconvenience, but in the end I believe that it will solve more problems than it will cause.

What do you think about hosting with just one hosting company?  Share your thoughts below.

But you can do keyword research without keyword tools.

I know that this might be a little bit against the grain, but hear me out.  You see, lately I have been working on creating some niche store websites.  Specifically, these are eBay affiliate websites and they will just be another income stream in my business operations.  Though I started out using keyword tools, I really haven’t been using them for these types of sites.  In fact, the following is the “keyword tool” that I have been using:

My wife.

Now that might seem a little silly, but sometimes it makes more sense to use a resource that is an expert in the field instead of relying on a computer.  In my case, my wife is an avid scrapbooker, and a Close to My Heart consultant, and has been scrapbooking for the past ten years and she does a very good job.  In that respect she is very close to the niche that I was targeting, and could provide me with the keywords and categories of products that I needed to make the site complete.

Sure, she couldn’t tell me the search volume or the competition (that is what keyword tools are for, right?), but she did have an intimate knowledge of the niche itself, and could provide me with information as to what a customer in the niche I chose was looking for.  And in some respects, this is more valuable than any keyword research tool out there.

So, the next time you are considering entering a niche that you are not familiar with, consider talking to someone that would be your potential customer.  They can point you in the right direction as to the products you should be selling and tell you exactly what your target customer will be looking for.  In some respects, that is more valuable than the information any keyword research tool can provide you.