When the Dark Lord Sauron returns after hundreds of years of captivity, the easiest way to defeat him is to go straight to Mt. Doom and toss the Ring of Power into the lava to ensure its total destruction.
Or… you could get distracted by random side quests, fight a giant spider or three, and get tempted to keep the Ring for yourself.
In 2011-2012, I fell into the same trap that Frodo did – and the same trap that Peter Jackson did with The Hobbit trilogy – I got distracted by random side quests, unrelated adventures, and other nonsense until I finally came to my senses and destroyed the Ring.
- What actually happened after the partnership with WallStreetOasis fell apart, and how many kidneys I had to sell to survive.
- How I hired people in the most haphazard way possible: if you ever start a company, do the exact opposite of this.
- How our Cost of Capital web series got started and the one big point I wish I could change, looking back on it.
- The single good decision I made during this time that helped reduce the fallout from these mistakes.
- And a fairly blunt discussion of whether or not starting this business was worth it (hint: you may want to keep your day job).
Yes, everything from Sauron to the Ring of Power to selling my own body parts to fighting giant spiders: this will be a fun one.
Let’s get started:
The Day After the End of the World
At the end of Part 3, I left you with a cliffhanger ending: I had just lost the partnership we had with WallStreetOasis and it was unclear whether or not the business would survive.
Since I’m an extremely rational person, I instantly assumed I was going to lose all my income, become homeless, and die out on the street.
I even thought about quitting entirely and going back to “normal job” land, all on the basis of assumed future losses.
I woke up the first day after losing the partnership, turned on my laptop, and… nothing happened.
Course sign-ups continued, and although traffic and sales for the month of June 2011 were down over previous months, it wasn’t a dramatic fall-off… yet.
Then we entered July and the data got more ambiguous. There was a definite drop compared to May and June, which was unusual since fall recruiting was approaching.
But two other changes were also taking place at the same time:
- The marketing team I had spoken to back in June was now setting up paid advertising and revamping our promotional materials – after losing the partnership, I decided I had to hire them as a hedge.
- Traffic also increased substantially in the July-August period, partially because of Google’s search algorithm updates and partially because of consistent content production on the site over the years.
By the end of August, traffic and sales had both increased substantially.
I’ll never know 100% what was responsible for this – was it the additional marketing and traffic?
Or had my gut feeling (huge audience overlap between the two sites) been correct all along?
There was no way to tell – looking back on it, all I know is that I would have been a complete idiot to have quit at this point:
Source: Joel on Software.
OK, maybe the “adoption curve” wasn’t that much of a hockey stick but you get the idea…
You Can’t “Fake” Caring About People
Something else also played a role: word of mouth.
In the age of social media, you can’t “fake” giving a crap about your audience and customers, because word spreads rapidly.
Likewise, if you do put in the time to respond and be as helpful as possible, word also spreads rapidly.
Let’s be honest: many other companies in this market really do NOT care about offering support, answering your questions, or simply being real with you.
And they certainly won’t stay up until 4 AM giving you feedback on your case studies and Excel models, as I often do.
One Bad Idea? Why Not Make It Three Bad Ideas!
After resolving this minor struggle-for-survival, it was time for my next brilliant plan: pursue not just one, not just two, but THREE questionable ideas.
LeBron James would have been proud of me.
Idea #1: Hiring (More of) a Team
Around this time, I was also running out of ideas – after 4 years of writing about investment banking, I had exhausted my own personal experience.
So I thought I could “outsource” the content for this site and reduce my own workload by hiring a team of guest writers …
…Not fully understanding that managing this team and training everyone would also consume a huge amount of time.
My announcement post was “OK,” but my own response was downright silly.
Rather than picking 1-2 new writers, I selected over 10 new writers, under the logic that everyone had a different background and could write about different topics.
Training the new writers, editing article submissions, and following up and asking for new articles every few weeks became a 2nd full-time job.
Despite my own incompetence, we got some great features from all the new writers.
The process was my fault for not putting strict rules and standards in place, and for taking on way more than I could handle personally.
Idea #2: Producing a Web Series!
Around the same time, I had another thought:
So I took a “break” (“break” = working 8 hours per day rather than 12-14) in the summer of 2011 and wrote the scripts for what would become Cost of Capital.
It’s not that difficult to get your own dramatic web TV series produced if:
- You’re paying for it yourself, and you keep expenses low;
- You’ve already written all the scripts, and they’re coherent; and
- You have friends in Hollywood with connections to the web series community.
I turned to my friend Goldie, who lived in LA at the time and who knew other producers there.
We got a Director and several others on board, and everything seemed to be proceeding smoothly…
Or so I thought at the time.
Idea #3: Getting Into the Dumbest Relationship of My Life and Leaving Australia
After leaving the US and moving to Asia in 2009 and then leaving Asia at the end of 2010, I had planned to live in Australia for the rest of 2011… but those plans fell apart a few months into my stay there.
In late June I went back to the US for a friend’s wedding, and driven by a toxic combination of alcohol and self-delusion, I turned what should have been a short-term fling into a serious relationship.
Within 2 weeks, I knew it would never work out: there was a big age difference (I was older), a difference in maturity levels and personalities, and friends and family members on both sides
hated did not exactly like each other.
But rather than cutting my losses, I succumbed to the sunk cost fallacy and kept at it – like a trader who repeatedly ignored his stop-loss level even as a stock’s price plummeted.
And not only did I keep at it, but I also decided to move back to the US and live in New York City in the fall of 2011, partially due to this relationship and partially because I had no reason to be in Australia.
A move halfway across the world, a massive expansion effort, a new web series, and a toxic relationship, all while I was running both sites full-time.
What could possibly go wrong?
Dangling from the Edge of Sanity
So I arrived back in NYC in September 2011 and attempted to stay alive while doing everything above.
I was also adding dozens of hours of new video to the Bank Modeling course, but my pace was glacial because it was impossible to work in long, uninterrupted stretches when putting out fires from all sources.
Those “fires” also consisted of spending time responding to criticism from readers who didn’t like the new guest writers on the site.
I understood why some readers weren’t happy, but many of the reactions were way overblown.
We’re dealing with a website… you are not, in fact, going to die if someone other than me writes an article here.
One day, I spent 10 hours dealing with negative comments and emails, guest writers asking me why their work was being attacked, and then making even more edits to upcoming articles because I was becoming paranoid.
“Damn,” I said, “Did I really start this site because of a book called ‘The 4-Hour Workweek’? What was I thinking? Can I get a refund?”
Web Series Witchcraft
“To make a great film you need three things – the script, the script and the script.”
Meanwhile, work on Cost of Capital continued in LA.
Just one small problem: my scripts needed serious work, and people were “afraid” to tell me.
The basic problem was that I couldn’t decide if it was education or entertainment.
It’s very, very difficult to do both well, which is why documentaries are categorized separately from feature films.
The series ended up being more “education” than entertainment, though I inserted random fiction throughout.
As a result, it was too “boring” to gain mainstream appeal.
For this site’s audience, of course, it was great – but I had wanted to produce something that would go beyond M&I.
It needed more “pizzazz” and more human drama, but since I was funding the production no one had the balls to tell me, “Brian, rewrite your scripts or hire a real writer.”
One Bracelet to Rule Them All
The question of what would go wrong first was answered sooner than expected – in the middle of October, about a month after I arrived back in NYC.
On that day, the girl I was dating (for all of ~3 months, by this point) marched me over to 5th Avenue and revealed the gift she “wanted me to buy for her.”
My only clue was that it “had been on Entourage before.”
We walked into the store and I saw it right away: it was the gold bracelet that Amanda (the female agent Vince switched to when he got upset with Ari Gold once) give to Vince back in season 3 of Entourage.
The only problem is that it was $5,600 USD.
Visions of Sauron breaking out of captivity and possessing this bracelet, rather than his usual Ring of Power, filled my head.
Predictably Irrational Decision-Making
At this point, of course, I should have ended it, cut off all communication, run the other way, and immediately moved away from New York.
Instead, I did the dumbest thing possible: rather than saying yes or no, I attempted to “compromise”… which inevitably led to more drama, which eventually, yes… led to me giving in and buying it just to avoid more months of fighting.
I’ve made a lot of business and personal mistakes over the years, but this was easily the worst personal mistake I’ve ever made.
When you work crazy hours constantly, your judgment in non-work-related areas gets impaired – which is what happened here.
Any sane person would have instantly ended things, but my “sanity meter” was nearly empty and I was running on fumes.
Luckily, someone was about to slap some sense into me…
How I Met Yoda and How He Changed My Life
A few weeks later, something equally shocking happened: I met Yoda.
One of the head members of the marketing team I had been working with came to visit the US, and we met up for a day-long planning session.
I came into it with an ambitious goal: I wanted to grow the business by 10x within 2 years.
That type of growth is close to impossible, even for successful venture-backed start-ups – let alone a small business in a niche market.
But I was incredibly determined, mostly because I had already put an ungodly amount of time into the business and wanted to take it as far as possible.
My conversation with Yoda went something like this:
“Me: So here’s what I’m planning for next year: more interviews, more courses, and expanding what we already have. Oh, and this new web series, and more guest writers… did I tell you I’m already researching even more specialized courses?
Yoda: Your goal is to grow by 10x in 2 years. How much revenue will all of that generate?
Me: Well, if we sell XX new course that could bring in…
Yoda: But you’ve already covered the major areas. These new courses would appeal to fewer people, and they would require 2,000+ hours of intensive labor to create. On an hourly basis, you would earn more working at McDonald’s.
Me: OK, but I really want to cover everything… and besides, what else can I do?
Yoda: Your plan is completely ass-backwards.
Fix the existing problems with your business first:
- Your most advanced courses are the cheapest ones. WTF?
- Your websites look like an elementary school kid’s art projects, and the UI and features need a revamp.
- You’re not following up with customers after they sign up, and you’re not encouraging them to use the site or to sign up for any other courses they might need.
- Your existing marketing is ineffective because you’re not describing the benefits of your courses in much detail.
- You should improve your existing courses by adding features like certifications and transcripts that customers want.
- You’ve been relying almost 100% on free traffic, and you’ve never put serious money into paid advertising.
- If you want to grow to that level, you need to get schools and major firms using these courses… which you means you need sales reps to sell to them.
Me: Good points.
Yoda: So how serious are you about actually growing by 10x in 2 years?
Because if you stick to your current path and spend all your time on training writers, editing articles, creating niche courses, and producing a web series, I guarantee you will never reach that goal.”
I could not implement everything above on my own, so I would definitely need outside help – if I decided to go through with his suggestions at all.
Decisions and Actions
I didn’t spend much time considering my options since his suggestions were the only viable options.
It had already been an epic struggle to create courses on banks/insurance, oil & gas, and real estate, and those were the “easy” areas – going into even more obscure verticals and then committing to updating those courses over the next 20-30 years was out of the question.
Plus, managing article submissions from the new writers was killing me and it didn’t add much traffic to the site. It was 200% extra effort for a 10% gain.
And while the web series was fun, I knew I couldn’t spend much time on it if I had a ridiculous goal like growing 10x in 2 years.
Time to Turn the Ship Around
So by the end of 2011, I took Yoda’s suggestions to heart and completely changed my plans for the next year.
Peter (he’s probably answered your questions if you’ve signed up for one of our courses) had been working on a new course on venture capital & start-up financing, but I had to put it on hold indefinitely (sorry, Peter!).
I stopped researching even more niche areas, and started planning how to improve the existing courses and switch our shopping cart and other systems to something more robust instead.
And I made plans for fixing the course pricing, and improving the overall marketing and site design.
There was still some time for battling giant spiders on side quests – I visited LA for part of the Cost of Capital filming, for example.
But my focus shifted dramatically.
Eye of the Tiger
Six months of frantic work followed this decision. Picture that training montage in one of the Rocky movies, but even more intense.
Working with a larger group now, I went to work on a major redesign of the BIWS site, all the upgrades I mentioned, and improving the free tutorials we use to promote the courses.
It was a bit easier than creating instructional videos, but content creation is still content creation… so my hours continued to skew toward “crazy.”
From the beginning, I had always thought certifications were silly… but there was definitely value in adding quizzes to the courses, and certifications would be easy if quizzes were already in place.
Plus, we had received so many requests to add both quizzes and certifications that I couldn’t ignore them any longer.
But I also had no capacity to do the certifications 100% on my own, so I hired someone else to write many of the questions. Editing still took time, but it took much less time than writing and editing.
Selling to institutions got off to a much slower start (it’s tough, and sales cycles are long), but that also started in 2012 and expanded even more in 2013.
Outside of Work…
Meanwhile, as I started focusing on business 100% after my “vacation” in 2011, other things fell by the wayside.
I didn’t have much time to oversee the web series, so it was handed off to the team in LA until I saw the first trailer in the summer of 2012.
But after months of drama and an incredibly stupid move on my part in 2011, my relationship seemed to be improving in the early part of 2012…
And as the middle of 2012 approached, there was a sudden improvement.
Most of the drama went away, the complaints that I worked too much diminished, and I found myself less stressed out each day.
“Finally! Maybe this will work out.”
Or so I thought.
Interview Guide – Back Again?
I was in for another surprise by the middle of 2012: the interview guide we offered – and that saved the site in 2008 – was in serious trouble.
More competitive interview guides were emerging, and some had features that our version, at the time, lacked.
And we were getting more comments to the effect of: “Why is this better than X interview guide or Y interview guide?”
Sales were going down, refunds were going up, and it wasn’t going to sell in its current form for much longer.
If I had 4 months of dedicated time and some help with the writing, I knew I could make the existing version 10x better.
So I completely changed directions once again, put marketing projects on hold, and locked myself in a room, cut off all friends/family/outside distractions, and got to work revamping the interview guide.
Rather than just presenting questions and answers, I wanted to explain the concepts in the first place and give you a way to test yourself via quiz questions with automatic scoring.
I ended up hiring 5 other writers to help with it, from the hundreds of quiz questions to the massively expanded “fit” section – and even after all that, by early August 2012 it still wasn’t where I wanted it to be.
But remember the main lesson from Part 1 of my story: you have to get your product out the door, even if it’s not perfect.
There was another clear deadline this time: recruiting season.
I had to finish this by the middle of August, even if it meant pulling all-nighters and going cash flow-negative for a while.
Other friends looked at me and said:
“Really, Brian? You’re in Year 5 of this business, it’s now 20x bigger than when you started in 2008, you’re not in a desperate financial situation anymore, and you’re still pulling all-nighters?”
Being my usual friendly self, I said they were stupid and ignored their questions.
Launches, Launches, and More Launches
A flurry of launches followed in August and September of 2012.
First, I gave up on my perfectionism and released the imperfect-but-still-greatly-improved interview guide on August 16th, which resulted in a “Wow, this is the best interview guide I’ve ever seen” reaction from many who signed up.
Then, in early September, we launched the Cost of Capital web series after holding a premiere party in LA.
Hundreds of people showed up, even though I had barely had any time to promote it.
But if you have a big event in LA with free alcohol, hundreds of people will tend to show up.
The series turned out better than I expected, even though the original issue of entertainment vs. education lingered.
The producers, director, actors, and everyone else involved all did a fantastic job, and the problematic area – the writing – was entirely my fault.
“Two launches done, a third one coming up, and hey, my personal life might just be getting back on track,” I thought.
So it was time to take a break, go back to my serialized TV addiction, and catch up on Homeland Season 1 right before Season 2 started at the end of September.
We’re Like Good Friend, Sharing a House
I got to that episode in Season 1 where Saul’s wife Mira, after being estranged for a long period when he’s busy with work, says, “We live together, but we’re not really married. We’re like good friends, sharing a house.”
And then it hit me: the exact same thing had happened to me.
Nothing had been “resolved,” and the apparent lack of “drama” just meant that we had been barely talking at all…
…Which is easy to forget when you’ve locked yourself in a room for 4 months to avoid distractions.
After I took the time to come up for oxygen and look at the outside world, I realized there were too many “unexplained events” on her side to ignore.
Too many disappearances without explanations, too many field trips off with other friends, and no real idea of what was even going on anymore.
If I asked directly, I wouldn’t have gotten a real answer – plus, I had this epiphany around 3 AM one night and normal people were asleep by then.
So I had to act like the NSA and use electronic surveillance to get what I was after.
She had been using one of my old-and-no-longer-in-use laptops for the past year, which was conveniently still in my apartment (as was most of her stuff).
I sat down, thinking I would have to go to extraordinary efforts to find incriminating evidence…
How to Beat the NSA at its Own Game
But when I opened the laptop, it was much easier than expected: she had left her email account, Facebook account, and almost every other account logged in and open.
I took a quick look through, and the evidence was pretty horrifying.
In effect, she had been running her own “Ponzi Scheme,” but with men rather than clients’ money.
Of course, she had been having multiple affairs – that was expected.
The unexpected part was how she used each person for a different purpose, from getting into clubs to psychotherapy to even more expensive gifts.
Oh, and the superhuman efforts to prevent everyone from finding out.
It was the Bernie Madoff of relationships, and I had to get out before I went down in flames.
I went to work saving every single email, Facebook message, and other file I could find, and putting them in my “evidence jar.”
Wake Me Up When September Ends
What followed could best be described as a Taylor Swift song (maybe this one) crossed with 500 Days of Summer crossed with Gossip Girl.
Rather than ending things right away, confrontation only resulted in… an even more muddled relationship.
I had a brief thought that I could “compromise” once again… before coming to my senses and realizing that I had to immediately exit and enact some “asset recovery.”
So I immediately got the Ring of Power back, along with some other foolishly-purchased items.
Sure, it had been a massive waste of time, but at least I recovered all my assets – unlike Bernie Madoff’s victims.
I was tempted to act like Frodo and Gollum and toss it into Mt. Doom to save Middle-Earth, but reselling it to save Middle-Earth was a wiser move.
I might not have been able to defeat Sauron for all eternity, but at least someone else would have to deal with the Dark Lord now.
There wasn’t even a Scouring of the Shire (I never heard from her again), so I outperformed the hobbits.
To a New Site and Beyond
It had already been an exhausting year, but I wasn’t done yet.
The new BIWS site, while “almost done,” still had a lot of bugs and unfinished pieces.
So I had to spend the entire month of November overseeing other people who were testing the site, testing a fair amount myself, and cracking the whip to get it out the door.
As with the new interview guide and dozens of other projects, it was never going to be perfect but I had to ship it ASAP anyway.
I told everyone, “OK, we’re launching this by the first week of December. I am not letting this drag on through Christmas / New Year’s. I don’t care if I’m traveling or this requires a week of all-nighters, it has to be finished. Cut features if necessary.”
And it worked.
In the process, I set a new personal record: only 12 hours of sleep in 5 days.
But the new site was a massive improvement over the old one and we instantly got positive feedback… and even more when the certifications and quizzes were launched after that.
New York, I Hate You XOXO
With the new site and the other launches done and no real reason to be in NYC anymore, I decided I was done with New York.
If you have to live there for work, that’s one thing – but my physical location is irrelevant, and I could save far more in other cities/states.
Plus, I needed a change of pace and a new location after the mildly traumatic past year.
So I planned to depart by January/February of 2013.
New Plans for the New Year
I was also going to change my business strategy for the next year.
I could no longer spend so much time managing a large group of writers, so I would go back to writing much of the content, with occasional contributions from others.
It was the right move to bring on guest writers, we did get some great features from them, and they did the best they could have – but I wasn’t good enough at running a tight process to keep it going in full force.
And if we did another web series, I would have to hire a real writer to ensure that it had more mainstream appeal.
My own time was best spent on what had already worked well: improving both sites, the existing courses, our overall marketing process, and overseeing institutional sales.
In other words, everything Yoda had told me about back in that November 2011 meeting.
If I had unlimited time and money, I would publish 10 high-quality articles per day, create 500 courses, and produce a TV series every month.
In the real world, though, you have to say “no” to most opportunities so that you can focus on the best ones instead.
It was the same lesson I had learned the hard way back in 2008, but had lost sight of in the years in between.
With that in mind, I closed out 2012, got ready to leave NYC, and looked ahead to the next year and beyond.
Sauron might have been defeated, but my work in Middle-Earth wasn’t finished yet.
A new age was just beginning.
So why did I write this series in the first place?
Two main reasons:
1. To Show You What It Takes
Contrary to what you might have heard, starting and running an online business is extremely difficult.
The biggest misconception is that once you release a product or service, you’re “done” – which is 100% false.
Do you think the world stands still just because you created something?
Nope – everyone is on the move, market conditions change, and new companies and products pop up all the time.
You need to innovate, or else your competitors will kill you, murder your family, burn down your house, and use the flames from your burning house to cook your families’ bodies before eating them.
It really is a lifelong journey, and you should NOT start a business unless you plan to stick with it 100% for a very, very long time.
Besides the time required, there are other trade-offs: I don’t have real “exit opportunities,” and I would have to streamline and simplify things if I ever wanted to raise a family.
Finally, it’s extremely isolating.
Can you imagine going a day without speaking to another human being in real life? What about an entire week, or several weeks?
If you can’t imagine that, you will NOT succeed in online business – at least if your role is content creation and marketing.
Was it all worth it?
From a purely financial perspective, I’d have to say, “No, it was not worth it – if you count the true amount of time I’ve spent and will continue to spend on everything.”
It would have been easier to join a venture-backed start-up, get even a tiny percentage of equity, and ride that out for 5-10 years… well, assuming the start-up became moderately successful.
Once you take into account non-financial factors, such as getting to work wherever I want, not having to deal with idiotic mid-level managers or office politics, and having complete control over my own schedule, it’s a closer call.
Even with those points factored in, though, I’d have a very tough time recommending this type of business to most people – it’s just too much work and too much isolation.
You need to have a unique personality to succeed in this field, and most people are better off joining existing companies or working in more of a team environment.
2. To Show You What Is Possible
On the other hand, you have to judge me by my actions – not my words.
I’ve been doing this for over 6 years now. If it were really that bad, would I keep doing it?
And would I plan to keep running it indefinitely into the future?
While it’s extremely difficult in some ways, it’s easier than normal jobs in other ways.
There are no “gatekeepers.”
You don’t need to get “permission” from anyone.
And you don’t have to deal with high-maintenance VPs, government bureaucrats, or any annoying/incompetent people.
When I started out, I had almost no credentials, qualifications, or relevant experience.
There were already entrenched competitors, existing sites, and established ways of doing things.
But none of that mattered.
If you are willing to out-work and out-invest everyone else in the market, sacrifice more, and hustle harder than your competition, anything is possible.
So if you don’t have the right experience, the right degree, the right company name, or anything else, don’t let that stop you.
Instead, take it as inspiration to prove the naysayers wrong and achieve the impossible anyway.
If you take nothing else from this series, take that.
Questions? You know what to do.
The Rest of the Series: