This week’s Misfit Entrepreneur is Craig Swanson. Craig Swanson is an entrepreneur, business coach, and co-founder of the online learning platform CreativeLive. Creative live went from a $100 startup to raising over $50 Million in VC funding becoming a massive success. After leaving CreativeLive, Craig has become the secret weapon behind course creators and business owners such as Sue Bryce, Susan Stripling, and Kaisa Keranen by helping them into the multi-million-dollar mark and even acquisition! Craig is also the board chair of the Seattle Entrepreneurs Organization Accelerator.

I’ve always loved digital assets as a business model. An entrepreneur can take their expertise in an area and have the ultimately scalability with a digital product, course, etc. And Craig has perfected the model. I am excited to get into all of this with him and to share all of his wisdom and experience from his incredible entrepreneur journey.

www.CraigSwanson.org ​

Follow Craig on LinkedIn

Craig started his first business after dropping out of college providing IT services to graphic design companies in Seattle. He did this for 25 years. And then he spun off an internal project which was Creative Live and built it up to massive success. He left there in 2016 and started what he does now - a small investment and incubator company with a fund that invests in and partners with a select few online creators per year to build niche platforms. He also serves his role in EO and is part of their accelerator program.

Talk to us about building a digital business. What should we know?

• People hold their ideas so precious that they don’t get them out in the market.
• What drives the success of a digital product is the market that has area need that your solution addresses.
• It’s not about how good you look or how well you present it. It’s about the market first.

How does someone identify the market and see if there is a fit? How do you test the market?

• Create a digital version of something that someone is teaching in person to groups of 10-200+ and has a track record of success.
• If it works for small groups of people, then you can create a digital version to scale.

At the 9 min mark, Craig gives an example of how they test a market with a client. It’s best to just listen.

Which type of product makes the best digital business?

• It is something that you create once and can continue to sell.
• A recorded video training program is the classic digital good and a good product.
• Additionally, digital downloads specific to industries, etc.

What is the process you go through to build the business around the product?

• The first step is a prototype with a core test audience. (1-10 people that will buy)
• With your first batch, you are relying on your existing relationships/contacts.
• After success with the protype, you then build a strategy to get your first 100 sales using success stories from you first group and partnering to get in front of other audiences.
• Once you serve more than 100 people and prove the product, then you can get to paid advertising and scale.
• Craig will give out free content to get people into the funnel and fold.

What are the best ways to market and sell a digital business?

• It is different for each product and different for different stages.
• Mediums will vary and you probably already have a medium where you get the most engagement and community.
• If you are starting from scratch, it is tougher.
• You must create an awareness and some sort of following before creating a digital product.

What are some ways to build an audience from scratch?

• A niche email newsletter that goes out as broadly as possible.

How do you grow an email list?

• Find a small community that you can really serve.
• Once you get some subscribers, ask for them to share it.
• Go where your market is (Facebook groups, communities, etc. that you can serve and help).
• Stick to a narrow niche.

How do you build a personal brand the right way?

• The first step is to become clear who you are servicing and audience and speak to that audience.
• Don’t approach your brand from a self-centric stance.
• The purpose of a personal brand is to connect with and draw in your ideal audience.
• Building a brand telling the stories and highlighting what those in your audience are doing to succeed is a great way to build it.
• There are 2 fundamental ways to build a brand: Either a student or an expert.
• You can position yourself as an expert learner and share what you are learning as you grow in the topic. People can follow and gain from your experience.
• As an expert, you can focus on delivering expertise to a community.

4 elements to scale any business?

• Scaling a business is when it starts to grow exponentially and can sustain that growth.
• The first step is to take something that is already successful with an audience and finding out why it has been so successful.
• Then you use the stories of success and their words to share why something is working.
• Next is to create a 2-step purchase process in which you have an entry level product from $10-$99 that covers the cost to acquire customers.
• The 4th step is to convert the customers into the larger more expensive product.

Any tips on how to create the value ladder?

• A lot of work goes into finding the right combination of offering and price that will scale.

At the 36 min mark, Craig gives an example of how they do this…

• “A lot of people in business become so fixated on the thing they have built that they want to sell that they stop listening to what the market is telling them that the market really wants.”
• You need an awareness to this.

What are the traits of good, high performing businesses vs. those that underperform?

• The difference is in the way they think.
• A lot of less seasoned businesses entirely fixated on how to make the existing business model more profitable. They are looking for the magic secret that lets them grow.
• More mature businesses have found that they have to let go of their original offering or change it to make it the best to grow and scale per what the market wants.
• Smaller businesses “swell” their business instead of scaling their business.
• Scaling businesses tend to be simpler with a clear focus on just 1-2 products/solutions and build the machine around them to infinitely scale.

At the 42 min mark, Craig and I talk about how businesses are much like life as they grow and gain experience.

• Don’t be afraid to kill ideas and let go of legacy things in your business. ​

From your journey, what do you feel are you most important and impactful lessons you’ve learned?

• Letting go of control and learning to trust partners.
• Build partnerships that work and commit to them to make them go.
• Have a clear mission.
• Co-build and co-create.

Best Quote: A lot of people in business become so fixated on the thing they have built that they want to sell that they stop listening to what the market is telling them that the market really wants

Craig's Misfit 3:

1. Be clear on what is negotiable and non-negotiable about your brand. L
2. et go of negotiable elements and stand firm on non-negotiable.
3. If something is worth doing, it is worth doing poorly. You get better as you go. Fail sooner and learn faster.

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This week’s Misfit Entrepreneur is Mariusz Skonieczny. Mariusz is the founder of MicroCap Explosions and the author of 11 books on the subject of investing. Mariusz has carved out a unique niche investing in microcap companies where the institutions don’t play, and the retail investors don’t focus. And it’s very lucrative. Over the course of a decade Mariusz personally turned $10k into over $7 million investing in Microcaps and now he teaches others to do what he does. I’ve always loved exploring unique niches with the entrepreneurs that find and maximize them, and I’m excited for Mariusz to share his journey and more about the Microcap niche with you in this episode. Mariusz Skonieczny on YouTube Mariusz philosophy is to go where others can’t go or don’t want to go. You have to be very picky about where you are going to be competitive and look for the best place where you can have an edge. Mariusz was born in Poland and grew up there focused on sports. He came to the US in his late teens and wanted to play basketball. He was not good enough and it broke his heart. He was not competitive enough…not to mention he could hardly speak English. This experience led him to discover and look for unique niches that don’t have a lot of competition. He gravitated toward investing. At first, he did what most people do and invested in blue chip stocks. As he found, if you do what everyone else does, it doesn’t pay that well. He then heard an interview with Warren Buffett where Warren talked about how investors need to look for unique opportunities that other investors don’t or won’t invest in and that set him on the path to do what he does now in the microcap space. What is a microcap investment? Companies that have market capitalization of less than $200 million. These are companies in which all the shares outstanding multiplied by the price are less than $200 million. Most of the time, these companies’ stocks trade less than $5. Some of them get a negative connotation of being “penny stocks.” What matters is the business behind them and that is the key – if there is a good business behind that has a path to grow, then it can offer a good opportunity. These companies are publicly traded, but usually on secondary exchanges such as Toronto or OTC. There is less competition there as well. A lot of the companies “grow up” on these exchanges and then move over to the larger ones like the Nasdaq, etc. How do you find a microcap opportunity? You can find them on stock screeners, but Mariusz goes to an exchange like the Canadian Stock exchange that has 700 companies and spends the time to evaluate each one to find the best. 80-90% are not great companies. He will whittle it down to the top 50 or so, then find the top 10% out of those and then do full diligence to decide the best one. He’s willing to do the work where others don’t. What are the criteria you look for in a microcap? Don’t invest in trash companies! Find the diamond with high quality revenue. Recurring revenue is critical. The business model offering should have high switching costs meaning it is hard for a client to drop the offering. The business should have high margin revenues with gross profit margins above 50%. The business should also have a long runway and growth trajectory. How do you predict the success and growth rate of an opportunity? Each business will be different. An example is Voxster which focuses on the real estate industry. At the 17 min mark, Mariusz discussed Voxster’s business model and how he evaluated the company to invest in it. How do you manage risk? The best thing you can do to manage risk is to invest quality companies with proven business models and profitability. You must also not overpay for them. Most companies are too expensive. You must have patience and be selective. How do you determine value, so you don’t overpay? You can look at multiples of revenue or income. With smaller companies, net income is not the best way because they grow faster and sacrifice profitability by investing it back into the company for the growth. 1-3x revenue is a good rule of thumb when it comes to the stock price and how it is trading. How do you stay in an investment? Years – typically 5-6 If you are a businessperson or entrepreneur, you know it takes time to grow. Play the long game. Anything else we should know about microcaps? You must have patience. You must have tolerance for volatility. You can get homeruns if you don’t overpay. ​ What other lessons have you learned on your entrepreneur journey? If you see a problem, don’t wait for others to solve – see if you can be the one to do it. Or look for companies that solve problems and become part of the journey by investing in them. Best Quote: If you see a problem, don’t wait for others to solve it – see if you can be the one to do it. Mariusz's Misfit 3: Think independently. You don’t need others’ approval to do what it is you want to do in business or investing. Do not worry about what others think.

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This week’s Misfit Entrepreneur is Bryan Clayton. Bryan created the “Uber of Lawncare,” GreenPal. It is a company that makes it easy to connect homeowners with lawn care professionals with the touch of a button. Bryan and his team built the company from scratch to over $20 million in revenue, serving 300,000+ customers in just a few years and their story has been featured everywhere from entrepreneur magazine to INC and Harvard Business Review. Prior to GreenPal, Bryan founded Peachtree Inc, and grew it to $10 million before it was acquired.

For anyone out there who has had a good idea for a business, but didn’t act on it because they weren’t sure how to make it a reality or didn’t have the experience needed to do it, Bryan is proof that it is absolutely possible. In fact, it is probably easier than you think. And that is why I brought Bryan on – to share how it is possible and what he learned in making GreenPal a reality.

www.GreenPal.com

@BryanMClayton on Instagram

Bryan wants you to know that if he can do it, you can do it. He’s spent 22 years as an entrepreneur in one industry, lawn care. He started a lawnmowing business in high school and continued to build it through college and then over the period of 15 years built it to over $10 million in revenue. He sold it in 2013.

He took some time off and after a while started to look at what to do next. He thought there should be an app to make it easier for people find lawn care professionals. He didn’t know what he didn’t know and over the last 10 years has built GreenPal.

Talk to us about how you did it and figure things out…

• Startups and entrepreneurship are less like chess and more like poker. Chess is more of a logical series of moves that lead to a result vs. a smart bet and playing risk vs. reward in poker.
• In the early days, they tried to outsource the coding and it failed. They had spent almost $200k getting the company going and had nothing to show for it, so they bit the bullet and decided to learn to code themselves.
• They went to a coding bootcamp and learned the basics which helped them create the second version.

Biggest lessons from building your businesses?

• Startups fail, but entrepreneurs don’t.
• As a founder, you will need to have flexible persistence going from one failure to the next without a loss of enthusiasm.
• Think of it like an old school video game where you have to figure how to get through one level at a time. It’s the same in business.
• Small incremental wins add up over time to a big business.

What did you do to help you grow in your business that other could use?

• First time founders worry about product and second time founders worry about distribution.
• The most important strategy is how to get people in the door.
• He learned quickly with GreenPal that if you build it, they will NOT come.
• He had to create a customer acquisition and development strategy.
• First, he went old school like he did in his previous business putting flyers on doors.
• This got them a couple hundred users.
• Second, you have to get out of the building and go talk to your users. Delight them.
• They went on a mission to meet people at coffee shops, etc. and ask them how they find lawn care services. Google search was most prevalent, so that is where they put their efforts to gain visibility.
• They had to learn SEO and organic search and put the bulk of their resources into it. It started to work, and signups began to grow.

Talk to us about how you did your SEO and organic search strategy vs. buying ads…

• Google AdWords and Google Search get conflated. They are different.
• It is one thing to pay, another for Google to rank you as #1 organically.
• It is tough.
• There is competition everywhere. You have to build it from the bottom up. Start small.
• They focused on local communities and ranking #1 in those areas – the small little towns that were suburbs around the main city and eventually, they began to be ranked for the larger city itself.
• Launching a market is launching all the little towns around it.

What did you do that got you noticed?

SEO 101:

• On page (content). They created guides on the best lawn care services in each township. The best content possible.
• Technical: Page load and URL structure, key words, indexable, etc.
• Backlinks: Who talking about this website or page? They would reach out to local reporters of the small-town magazines and give them stories as they launched in their area. Test, then invest. You need to do it yourself before you build out the processes and teach others.

How do you start a business with no money?

• Even with no money, you have asset and resources you can put to work. Many times, they are in your mind.
• As you start to get money into the business, the key is to be a good capital allocator to invest back into the business.
• The least you can live on, the greater your options in a startup gutting it out with no outside capital.
• You are your business as a founder and the business needs to come first when it comes to money.
• The first couple of years will be tough.

Talk to us about playing the long game?

• Genius gets mistaken for consistency.
• There are very, very few overnight successes.
• People don’t see all of the work that happened, many time for years, before the success is known.
• Success is a cumulation of work over years.

Thoughts from your experience selling and exiting a business?

• It’s the dream and it’s hard to do well.
• Work a 5-year exit strategy plan.
• Things like EBITA growth and systems are key to selling.
• Read the book Built to Sell.
• Many times, the time business owners try to sell are when they or the business is in its worst shape.
• Face and fix the things you don’t want to deal with.
• You want to sell when things are at their best and you’ve optimized. Sell your business when you are in love with and would hate to see it go.

What should people know about the lawn and landscape industry?

• You can learn so much running a small service-based business in a couple years than in a year of classes.
• It is also a great place to get your first exit under your belt. You can start a little service business, built it up to $500k or $1 mil and sell it.
• At the 40 min mark, Bryan shares his message to people who think they can’t do it…

Best Quote: Genius gets mistaken for consistency. There are very, very few overnight successes.

Bryan's Misfit 3:

1. Spend less time on things that don’t matter.
2. Know when to delegate and when not to delegate. Delegate from a standpoint of stewardship.
3. Are you going to be a fox or a hedgehog from Good to Great? The fox is flashier in style and the hedgehog just keeps it head down and works one to two things really well. Pick which one you are.

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Many years ago, I introduced a new format that alongside our regular episodes called “Lessons for Hannah.” Hannah is my daughter and one of the main inspirations for the Misfit Entrepreneur. I wanted to have a place where she could go and learn from her daddy and his Misfit friends throughout her life….even after I am gone. If you haven’t listened to the first episode of "Lessons for Hannah," I urge you to as it gives some more background and tells the amazing story of how Hannah came to be in our lives.

Lessons for Hannah are short, very useful, and sometimes comical lessons, that I want to share with you and give to Hannah to help in your lives. Because I want Hannah to have these for her life, I’m going to speak as though I am talking directly to her. These episodes are a lot of fun and if you think there is a lesson that we should include in these episodes, please don’t hesitate to send it over to us at support@misfitentrepreneur.com. We’d love to share it.

This week’s Lesson for Hannah

Hannah, In this episode, I want to speak to you about choice. Not a lot of thought is put into choice in our lives, yet every day we make many choices. In fact, our lives consist of making choices over and over again. Most of the time, these choices are automatic. We don’t think about them. Our subconscious mind just reacts with the stored programming it has built up over the years. I’ve talked many times about our conditioning and how the subconscious mind is the most powerful part of our brain that runs us without us even knowing, or at least thinking about it.

It is important to understand how the subconscious works and how it is programmed because it directly affects our choices. Everyone is born with a clean slate when it comes to their minds. It is the influences and experiences we have in our lives, as well as some primal instinct, that shape how we think and act – effectively conditioning our minds. Sources of this conditioning come from all different areas: Parents, family, friends, culture, school, media, and many of the life experiences we have. For example, the first time you touch a hot stove and get burned, your subconscious registers that and the next time you are near a hot stove, you know not to touch it. Think about things you say or your thoughts – where do they come from? Have you ever noticed yourself saying things that your parents said to you repeatedly as child? Chance are you do. It is an automatic conditioned response, and your subconscious has them for pretty much everything in your life.

Most of the conditioning we get is positive, but we can pick up some things along the way that can hold us back or keep us from reaching out true potential. That is where choice comes in, in a big way. The biggest realization that changed my life and set me on path to reach potential people previously thought was impossible for me was when I learned that I could choose my thoughts. That I had a choice. I did not have to be run by programming built up over the years. And just as important was the understanding that the choices Imake every day, directly affect my path in all areas of my life. We are the sum of the choices we make.

First, I had to learn to recognize my programming and the responses (choices) that I was making throughout each day and start to ask myself if I truly agreed with those responses. Were those something I put in my mind or were they put there by another influence or experience I have had? I then had to ask myself if that was something I wanted to keep or get rid of. And, if I wanted to get rid of it, what was most important to replace it with. I admit this is not easy to do and is absolutely a lifelong commitment and journey. If you commit to it, it will be very awkward at first because you literally have to learn to do what I call “Stop, Ask, and Choose. You have to stop yourself when you recognize a thought or reaction that doesn’t seem to be in line with what you believe or what you want for yourself. You then have to ask yourself if you want to keep it as part of your life or not. And then, you have to choose whether to keep it or what you will replace it with. The first few times you do this, it will be very awkward stopping mid-sentence or mid-thought to ask these things of yourself, but the subconscious picks up things fast. After a few times, it will start to happen quickly and soon be just as normal as brushing your teeth or throwing a ball.

Once you understand how to live from true choice in your life, then the fun begins. Each day, you get to control your choices. Remember, you are the sum of the choices you make. You gain the ability to be intentional in the choices you make and find almost a hidden superpower inside of yourself. In fact, in some ways, it is not fair to those that haven’t figured this secret in their lives. Gaining control over your choices essentially allows you to level up any time you want. After all, it is a choice to do so. Of course, you have to do the work alongside the commitment you have made with the choice, but if you were not aware to the fact you even could choose this for yourself, it would not be possible.

Hannah, I hope you can see how important this lesson is for all areas of your life. And I hope that you can also see how growing yourself in the ability to control and choose your thoughts can give you such an advantage in your life. Like I said, the choice is the first step – you still have to do the work, but that is the exciting part as you make your way to your next level. Here’s to living from true choice in our lives.

I love you,

Dad

Best Quote: Gaining control over your choices essentially allows you to level up any time you want.

Misfit 3:

1. We are the sum of the choices we make.
2. It is important to understand how the subconscious works and how it is programmed because it directly affects our choices.
3. The ability to choose and be intentional in the choices you make ais almost a hidden superpower inside of yourself.

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This week’s Misfit Entrepreneur is Andrew Lee Miller. Andrew is a startup expert; in fact, he’s known as @AndrewStartups around the world and has been bootstrapping companies for over 15 years. He is a marketing expert and founder of the award-winning marketing agency, Growth Expertz. He has driven growth for 3 VC backed startup exits to the tune of $450 million and dozens of other funded startups, including raising over $25 million in seed rounds in the last 5 years.

Andrew speaks and trains entrepreneurs throughout the world on paid advertising, growth hacking, public relations, search marketing and more. He is also the author of the best-selling book, The Startup Growth Book.

What I love most about Andrew is that he is scrappy and finds a way to make it happen no matter thecircumstances and I’ve brought him on to share his best with you in this episode.

www.AndrewStartups.com

Andrew was born and raised outside Columbus, Ohio. His whole family were entrepreneurs, but he never grew up wanting to be one. He ended up having his own business at 16 detailing cars and had a problem with authority which made him want to stay independent. He went to college for general business and switched to international business. He started a virtual resume startup in his senior year. He and his partner got investment and the business took off – it actually scared him because he didn’t want to be stuck in this one business through his 20’s, so he decided to travel.

He moved the Mexico when he was 21, then after a few years moved to Dubai. Dubai was much different and didn’t have much of a startup culture. He joined a company that was a sort of Craig’s List type service as head of marketing. He growth hacked the company from 800k page view a month to over 25 million and the company was acquired for a large amount. Andrew realized there was a niche in growth hacking. He had a few more successful projects in Dubai and then went to Silicon Valley and had another successful exit. He then started coaching people and became a digital nomad helping startups and traveling to over 40 countries.

You mentioned a formula for growth hacking that you put into practice and now teach others, take us through it.

• First, when he starts with companies, the product is never ready to be marketed. Are people sharing or referring the product? If not, then a focus is put there to better market it. Product optimization.
• Once you’ve optimized the product, then you are ready to grow. Do not rush to paid advertising.
• It’s never too early to start marketing. Marketing is different than advertising. Advertising is something you do to scale up your marketing. Marketing can happen at any time.
• You can start building a list, basic SEO, organic social media marketing/following, etc.
• You can then launch with a waiting set of customers and some recognition in the marketplace.

What is the difference between advertising and marketing?

• You do not have to do paid advertising to succeed.
• Paid advertising isn’t necessary for every business.
• We are shown ads that you need to run ads to grow your business, and that is just not true.
• Marketing is the actions you take to grow your visibility, your brand, and awareness for who you are.
• Advertising is paid ads and spots to drive traffic to your business.
• Focus on organic channels for the first 12 mos in your business. Talk a little more about organic.

What do you advise? What’s the best place to get traction?

• List building and e-mail marketing is the best thing to do.
• Next is social media and off-channel marketing such as Reddit or Facebook groups.
• Using incentives for first adopters is a great strategy whether it is free services/product or a very low cost, etc.
• For B2C focusing on long-term things such as app store automation for apps, social media, and off page.
• B2C is harder than B2B. There are a lot more moving pieces to create an eye-catching brand.

What are your thoughts on social media? Where should people be to get the most bang for the buck?

• B2B – the place to spend money is Google Search because the intent is so high.
• You also have a higher conversion rate on Google Search if you are using the right key words.
• For B2C – it depends on the product and service. Google’s UAC campaigns are good for things like apps.
• TikTok needs really good video creatives to do well, but there is less competition there.
• In the end, it all about the content on social media and video is the most important.
• YouTube ads are another inexpensive way to drive traffic and revenue.

At the 22 min mark, Andrew talks about using influencers and micro-influencers to help grow your brand and visibility.

Other PR hacks entrepreneurs can use?

• Local PR in your local markets is a great place to get visibility and media.
• Getting on podcasts is a great way to refine your pitch and gain visibility/credibility.
• You should do PR from early stages of your business.
• 3 Things:
  • Craft the story – your title is important and having a unique angle
  • Building a list of those that might be interested in telling your story (Podcast hosts, reporters/writers, etc. found on Google Alerts)
  • Distribute your story and your PR effectively to the sources.

At the 30 min mark, Andrew talks SEO…

• Andrew is big on doing “on-page” SEO correctly.
• Use Link Building.
• You can use Free SEO audit tools online. Google Free SEO Audit.
• You can even do Craig’s List and University Job boards as SEO hacks.

Thoughts on raising money and exiting companies?

• We are sold that we need to raise money and that is wrong. You can bootstrap and do great.
• Fundraising is a second job and will take almost 100% of your time over 6-12 months taking you away from your business.
• You need to really think through and decide if you need to raise money and you need to have the business in the best position to do so.

What is it that you think most entrepreneurs miss that holds them back the most?

• They go too much with their gut and hunch instead of compiling and working from the data. ​

Any other lessons from your entrepreneur journey that have made a huge difference?

• Let passion drive you – not making money.

Best Quote: It’s never too early to start marketing. Marketing is different than advertising. Advertising is something you do to scale up your marketing. Marketing can happen at any time.

Andrew's Misfit 3:

1. Just go. Stop finding reasons not to do things and do them. Don’t be afraid to break stuff.
2. Don’t succumb to worry and overthinking.
3. If you love what you do, you never work a day in your life.

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