Million Dollars in 2 Years is a story I had saved on my computer a long time back. Not sure whose it is, but something worthy to give a read.
The Story
Earlier, there was a post on why to quit your job this year. This was not a generic “you have to be an entrepreneur” article, but more with the reasons for doing so. It was more about of bad shit happening in the corporate world. And over time, you are going to feel the urge to quit.
Correctly, many people asked, “Well, what’s next? What should I do?”
I’ve begun asking people who did it. What did they do? How do you quit your job and finally, how to make a million dollars?
Not everyone is Larry Page or Mark Zuckerberg. Not everyone is going to drop out of college and create a revolutionary product.
Some people simply want to quit their jobs and make a good living. Some people want to quit their jobs and make a million dollars. In the movie (the Justin Timberlake vehicle), JT says, “A million’s not cool. A BILLION is cool.”
Well, very often a million is pretty cool. Not everyone will have a VC-funded $100 million hotshot. Sometimes it might be nice to make a million dollars, be the boss, and use the financial freedom to exponential success.
So I connected with Bryan Johnson, who did start a company called Braintree. While you may not have heard about the company, it has some well-known customers. Braintree provides credit card payment services for companies like Airbnb, OpenTable, Uber, etc.
I have never spoken with Bryan before, and I’m not an investor in Braintree. I connect with people who have interesting stories, and hear their viewpoint. That is my way of not only building contacts, but also lifelong friends.
I knew Bryan would have an interesting story on how he did set up Braintree. So I chose him for “what do I do next?”
In 2007, Bryan was a manager. He quit his job and was already making over a million a year in 2 years timeframe. Eventually Braintree did grow much bigger and raised $70 million from investtors.
So I started asking him, “How did you do it? What are the initial steps.”
This is what he said:
“I really disliked my job, and I never believed in the idea of getting a fixed wage. I had been a salesman before in the credit card processing business where I would go out and get merchants like restaurants and retailers to switch their business to the company I was selling for. So I figured I could do this but work for myself instead of another company.”
1. Take out the middleman
Instead of going back to the company he used to sell for, Bryan cut out the middleman and went straight to one of the credit card processor, worked out a reselling agreement with them for self, and he did all of this before leaving his job at Sears.
2. Pick a boring business
Everyone is on the lookout for the next big thing” The next big thing is very HARD WORK. Don’t do it! Bryan picked up a business that every merchant in the world needs. He also knew that it was an exploding business due to all stores trying to open up their online presence. You do not have to come up with the new thing. Just do the old thing slightly better than others. And when the size of the business is small, it is easier to make changes, compared to the behemoths who are stuck with bureaucracy. This often leads better sales and services, and make better connections with customers.
3. Get a customer!
This is a very important rule for an entrepreneur. People normally try to get the VC money first, then quit job, then build product and then expect a million customers. Doesn’t work that way. Always try to make a first customer, and then one more.
Bryan was able to find 10 customers (out of the first 12 he had approached) who would like to switch their credit card processing to him. He calculated that he needed to make $2,100 per month to quit his job. With his first 10 customers only, he would be making $6,200 a month. So he quit his job, and made the switch.
4. Build Trust While You Sleep
This most commonly heard statement about business is to Make Money While You Sleep. But Bryan was already making money while he slept, as he was making money on every credit card transaction from his first 10 customers.
“I didn’t want to be going around the street looking for customers,” Bryan said. “So I needed to find a way to be able to get online businesses as customers. Someone suggested that I should start to blog. And to be able to blog well, one needs to be transparent, or it won’t work. So I started writing on what was happening in the industry. This also included all the unscrupulous practices and how the merchants were being taken advantage of. Then these would be posted in the top social sites at the time: Reddit, and StumbleUpon, and sometimes these would get popular and my website would crash from the traffic.
“But I became a trusted source for credit card processing. Very soon, these online sites, that were having a hard time navigating this industry, started contacting me to switch their payment services.”
5. Blogging is not about money
Blogging is not about money, but about trust and this leads to opportunities. In his case it led to more inflow without having him to go door to door. This also led to his biggest early opportunity. His blog might be making a total of zero cents but it hascreated millions in opportunities.
“Basically, OpenTable connected with me for their requirement of a software solution to handle storing of credit cards, handing these data to/from restaurants, and being compliant from a regulatory standpoint. I signed a three year deal with them, and that allowed me to build a team of developers to build them the solution. There were now more services to sell to customers.”
6. Say YES!
He started out with just connecting online businesses with a credit card processor. Afterwards, OpenTable asked to do software development which he had never done before. He said YES! He then got software developers, built a product, and then quadrupled his income. This put his business to a whole new level of services, which he offered to his customers. Word of mouth spread like wildfire and other online businesses started using Braintree’s services.
“When we first started, for each new customer we had put together an entire package for the credit card processor on why we believed the customer could be trusted and would be a legitimate merchant.” With this we were able to build
7. Customer Service
You should treat each customer, new and old, like a real human being. “We intuitively knew what we didn’t like in customer service everywhere: automated calls, slow response times, bad problem solving, etc. So we made sure that there was as little friction as possible between the customer contacting and actually having their problem solved.” As a small business, there’s no excuse to having poor customer service. The best new customers are generally the old customers, and the best way to connect with them is to provide quick help when they need it. Customer service is the most reliable method to keep selling your service to them.
By year 2, Bryan was making over a million dollars a year and was doubling every year. They couldn’t hire fast enough.
After four years in business, Braintree took in its first VC funding – $34 million in a Series A round. And recently, according to CrunchBase, they do process over $8 billion worth of credit card transactions per year.
This is how someone went from 0 to 1 million dollars in 2 years. Not bad for someone who quit his job and just wanted to figure out a way to get his bills paid. To learn more on finance, click here.