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One of my values is only buying things I can afford. I have a very strict no-debt mentality and have always purposed to live within my means.
When it comes to business, I’ve always been bootstrapped. I don’t like the idea of selling equity or ownership. By taking on an investment, I would have a sense of obligation to an investor because they are expecting a return.
I’ve already decided not to take on investors. That’s all well and good. But what if someone wanted to donate money no strings attached? Here’s where it gets interesting: someone has expressed such an interest.
Nothing’s official and no actual offer has been made. I haven’t accepted or received anything. But the possibility of it brought up a very interesting discussion. What is the different between an investment and a donation? Should I accept a donation? How would a donation change things? Should it change things? What if it was anonymous?
One of the things I came to realize is that when you follow The Overlap Technique and Relationship Marketing, you are putting value out into the world. It’s easy to get so caught up in the giving that you don’t know how to receive. The conversation in this episode was insightful to say the least.
- New Show Coming to the Network
- 05:43 Sean: We’ve been recording some episodes of a new podcast that we’ll be releasing on the seanwes network soon: Lambo Goal. It’s a show I’m doing with Matt that you can check out at LamboGoal.com. It’s a business-focused show where two entrepreneurs take you behind the scenes and share real revenue numbers, real tactics, real methods, and real steps along the way to a accomplishing a goal so big that people call us ridiculous.
- 06:54 Certainly not everyone’s dream is to buy an exotic car. The show isn’t about one goal in particular—it’s about dreaming bigger and paring that with the business knowledge needed to succeed. We want to help people succeed in business in order to achieve some of those bigger goals they have. We’re merging all of that together and doing the Lambo Goal. We’ve now recorded two episodes that are streamed live to the Community members and it’s been a lot of fun. We’re building up a queue and going to record quite a few episodes before the launch. You can actually go to LamboGoal.com now to sign up so you can find out when the show launches.
- 07:39 In addition to this show with Matt, I’ll be building out seanwes as a network and a platform this year. Ben and Aaron are going to be coming on to the network with the shows and a courses they’re working on. There’s a lot of happening behind the scenes. This is going to be a pretty big year. Matt mentioned that he’s going to be doing a lot of big investment deals this year. People basically give him money and he invests it and gives them a return. He’s going to be orchestrating some pretty big deals and it looks like the returns will be pretty significant. He’s been removing himself from the daily operations in of all of his businesses and he’s trying to get people in place to take care of those things for him so he can focus on helping people. He gets so many people asking for help on business and investing that he doesn’t have the time for all of it. He’s stepping down from all of his busy work to make a course and focusing on doing the Lambo Goal show. He’s basically wanting to be as helpful to the seanwes network as possible. He really believes in what we’re doing here and he has mentioned that he’s interested in donating to seanwes.
Why I Don’t Want to Take on Investments
- 09:48 Where this gets interesting is, I’ve mentioned in the past that I don’t want to take on investors. The reason why I don’t want to take investors is mainly because of my No Debt Mentality. I don’t like to borrow money from people, I don’t take out loans, I don’t like to owe people, and I like to live within my means.
- 10:29 When someone invests in your company, they’re looking to get a return on that investment. You’re essentially selling some of your equity to investors and that’s not something I want to do. It doesn’t align with my values and it doesn’t align with the Overlap Technique, which is what I preach.
- The Overlap Technique
- 10:51 What I always say is to overlap from one thing to the next, don’t borrow a bunch of money to start your business. Get a day job in place and work hard. Do client work in the evenings to save up money and bootstrap it. I feel like taking on investments doesn’t fit with that approach and I don’t want to compromise that value. Matt doesn’t want to make an investment and he doesn’t want to get any equity out of the company. He’s basically saying, “I believe strongly in what you’re doing and I want to help you out.” With the investment deals he’s doing, they give a lot to various charity organizations and he’s basically looking at it from a philanthropic point of view. Obviously, seanwes is not a nonprofit but he believes in what we’re doing with the Community and helping entrepreneurs. These people that we’re helping are going to go out into the world and making a difference. They’re going to have a positive impact on their surroundings and he believes in that.
- 12:30 Ben: You shouldn’t have to make some sort of justification for giving money to one thing vs. another. That being said, I really like that Matt pointed out the idea that the seanwes network is not only influencing individual content creators but influencing the community that surrounds those people because of the way they’ll be able to do business based on what they’ve learned from you. You’re influencing the economies of where these people live and work, all over the world. When people work for themselves, it’s great for the economy so it really does go further than helping people do what they love. When you’re thinking to yourself, “Is accepting a donation for my cause a worthwhile thing?” then you’re probably a more worthy cause than you think because you’re even asking yourself that question.
Investment creates a form of obligation and it’s a kind of debt.
Investment vs. Donation
- 14:33 Sean: To clarify, this is all speculative. I haven’t accepted anything yet. Matt mentioned it to put it on my radar.
- 14:47 Ben: What if someone sends you an anonymous donation?
- 14:50 Sean: That was an example that was brought up. I’m struggling with accepting a donation from someone because I want to make sure it’s not an investment and I don’t feel a sense of obligation to someone. That goes against my values. Should I be taking on this donation? Someone brought up, “What if someone left you an envelope with money and there was no name?” Obviously, I can’t return it and someone believed in what I’m doing enough to do that so I wouldn’t have a problem accepting that donation. It’s not like I’m going to have a bonfire with it.
- 15:41 Then I realized, “Why does it matter whether or not it’s anonymous?” I decided to dig deeper and find out what was behind his motives. Is he expecting to get something out of this and just calling it a donation? The more we talked about it, the more I realized those weren’t his motives at all. I asked him, “Is this about tax write offs? What if it counted as revenue on my side? Does that bother you?” He said no because he already gives to charitable organizations, this would be considered something else because he didn’t need the money and he strongly believes in what I’m doing. That made it clear it wasn’t about getting anything in return and he even told me his backup plan was something along the lines of an anonymous donation—buying 1,000 Learn Lettering Master Classes. His motives are pure if he’s willing to go the transactional route.
- 17:02 Ben: Without going into into the legal structuring of accepting that donation—how it’s taxed, etc.—you’ve got the personal aspect of that. There’s the Rule of Reciprocity, where you feel beholden to someone else. Many of us have been in the situation of someone “giving” us something and not expressing they were doing it with the expectation of receiving something in return. Then, they start to treat you a little different or you treat them differently because you’re not great at accepting gifts. Robert Cialdini has a whole chapter on how the Rule of Reciprocity works in his book, Influence, but there’s a part at the end where he talks about how to circumvent that. Culturally, it makes sense to reciprocate a gift but if someone gives a gift and tells you it’s no strings attached, you really don’t have to feel beholden to them, even if they came back later and reminded you of that gift. You’re naturally going to feel beholden to them but you have to discipline yourself not to feel that way. I’ve gotten really good at accepting help, which is a gift of sorts, and showing my gratitude in whatever way I can but not feeling beholden to whoever is helping.
- 19:50 Sean: Accepting help is not a strength of mine and that’s probably why it was so difficult for me to scale, even if I’m paying someone to help. Help means not doing it myself and I pride myself on being self sustained. I would rather work harder than take on help from someone and that’s not always healthy. If someone is willing to help, there’s no shame in accepting that help and I think it’s good you’ve gotten to that point. I’m still working on getting to that place. I’m glad you brought up the Rule of Reciprocity because it was something I was struggling with. Am I going to feel a sense of obligation to Matt? In the chat room, Justin asked, “Would you feel guilty if the next day, after receiving a donation, you decided to retire?” If I did feel guilty, it would mean I felt an obligation, like they were expecting something back and I didn’t deliver on that vs. accepting it as a donation. After hearing the motivation behind this donation, I wouldn’t feel bad if I retired the next day. As we dug in deeper on the Rule of Reciprocity, Matt helped me realize that it’s not as though he was the initiator, it actually started with me. Matt brought up:
- 21:44 He said, “You’re putting things out into the world, people are getting value out of that, and inevitably, it’s going to come back to you.” That hadn’t clicked for me. I’m so long-game with putting value out there and I give, give, give. In my mind I know it will come back to me but I’m not thinking about it so I’m not in the mode to be able to receive that value back. You could see a donation as someone giving me something back because I’ve put so much value into the world.
- 22:23 Ben: We tend to have a narrow focus on the monetary aspect of a donation but when you’re talking about the exchange of value for value, there’s so much more going on there that you can’t even quantify. Even if you could add up the number of things you’ve put out for free and the way those things have provided value to the world, and put a dollar amount on that, that’s only one part of the whole equation. I don’t want this to come across as narcissistic but Rachel, my wife, and I have a music ministry together and I see our presence through that as adding value to people’s lives. Part of what makes it easier to accept gifts from people that offer us things is knowing we’ve added value to their lives.
- 24:50 Sean: You’re contributing to your community. Even if you don’t have a one-on-one Rule of Reciprocity situation with someone, you’re paying it forward and within a community, it will come back around.
- 25:06 Ben: Let’s say for example, someone wanted to donate $2 million. The fulfillment that person feels for giving that gift is a form of return on that giving in and of itself. Even if it was an anonymous donation so their name wouldn’t be attached to it in any way, knowing they were able to use their resources toward something they believed is a huge gift. The sense of pride in that gift is so valuable that I’m not sure the $2 million would outweigh that feeling for them if you compared it. It shifts the tables with the Rule of Reciprocity because you can’t give that feeling to somebody, it’s something they receive upon giving.
When you follow The Overlap Technique and Relationship Marketing, you are creating value.
Don’t be surprised when people want to give back.
How a Donation Would Change Things
- 26:32 Sean: In the chat room, Dale asked, “I think it would be cool to see how that donation would effect any long-term goals you had in mind previously. Does it shift priorities? Does it make you want to attain something completely different?” That’s a great question. My goal is to help people make a living doing what they love to do, and I’ve felt like I can continue at this current size, which was originally just me and now I’ve got two employees, while maintaining 98% quality. What I realized was I could continue doing that but I would be limited. There’s only so many hours in the day, I can’t be in two places at once, and there’s only so much I can do.
- 27:41 As I’ve freed myself up from some of the things I don’t necessarily need to do—like shooting my own videos—I’ve realized as a whole, we’ve been able to be more effective, put out more things, and help more people as a result. That’s where the network idea was birthed. A few select people I trust and believe in will be able to come on and extend our collective reach. My goal is to grow in a controlled manner, such that we maintain the upmost quality. I talk about 90% a lot—you can’t attain perfection. If I wanted to attain perfection, I would hold as tightly as I could onto every aspect of my business and not allow anyone else to do things. I would spend all of my time and energy making every little thing perfect but I think it does a disservice to the world.
- 29:41 Ben: When you reach a threshold and you realize you could reach even more people than you’re already reaching but you can’t reach them on your own, that’s when you want to scale and start thinking bigger picture. Before you get to that point, you want to provide the most you possibly can to the individuals you’ve already reached on your own. In that sense, Sean, you’ve done it right because even if you had all the resources, it would have made more sense to do things the way you did.
- 30:57 Sean: To answer Dale’s question, I don’t think it changes the goals but as far as priorities go, the priorities are in the order they are in because it’s necessitated. In order for me to bring Ben and Aaron on and cover the expenses of editing shows, writing shownotes, hosting files, development costs for building out the network, etc., I need to generate cash flow. Things like finishing my book, The Overlap Technique, have to be put on the back burner so I can focus on things that will generate cash flow if I’m going to be able to expand the network. I’m not writing that book to generate money, I’m writing that book for people to have that book.
- 32:04 If I had a donation or other resources contributed to me it would change my priorities. Right now I have to be focused on things that will generate revenue short-term, but contributions would mean having the freedom to do what’s best right now even if it won’t generate a return for a long time.3 The new chat system is a great example; I won’t get that money back from membership revenue for a while, but the improved experience for the Community members is important to me. I think a donation would serve as a safety net and would provide more flexibility with the order in which I do things.
- 33:21 As you go on, time becomes increasingly more valuable to you, or at least you recognize it has been valuable to you all along. People say time is money and I think it is in the sense that you can exchange it for money but eventually you realize time is infinitely more valuable because you only have a limited amount of it. You can never get more time, no matter how much money you have and eventually you run out. Say you want to learn something—there’s a lot of free information out there on the internet—but it takes time to wade through the not-so-good stuff to discover the things that are worth your time. Maybe that’s worth while to you if you don’t have the monetary resources. You can spend your time to get information but you’re using your resources one way or another.
- 34:31 What if there was a course that could teach you something in a much shorter amount of time than searching the internet and books for free material? I took a course to learn a program called Scrivener (Related: Learn Scrivener Fast). It was so valuable to me! I spent a couple hundred bucks and, in a matter of hours, I had learned this very complicated program. I could have figured out most of it on my own, but it would have taken me days or weeks of time. This course was like a Matrix download—boom! Here’s everything you need to know and everything you don’t. When I’m thinking about taking on this donation, time is a big factor. I could do more in less time if I had additional resources.
- 35:39 Ben: There’s a lot of wisdom in not thinking that if you had an influx of cash, you would still do everything in the same order. There’s a lot of sense in the way you’ve got things ordered now because in order to sustain the seanwes brand—let alone do it well, which you were already going to do anyway—the resources have to come before other things that are longer-term investments. When or if those resources you weren’t expecting come in, it’s important to take a serious look at why you were doing things in that order in the first place and decide if it makes more sense to shuffle things around at that point.
- 36:40 Sean: Like you said, I’m going to do all the things I’ve set out to do anyway. I can and I will accomplish them. There’s no doubt there, it’s a matter of reality aligning with my mindset. I’ve already accomplished those things in my mind, I’m just waiting for reality to catch up. I’m going to get there but it’s going to take a certain amount of time. Basically, my approach with everything is to get residual income in place—income that can be consistently generated with a minimal amount of work. Do that in a way that covers a comfortable lifestyle and grow the business with any additional resources. That’s something my courses and the Community have afforded me to do. It’s allowed me to be able to do things that help people, like record this podcast, create daily videos, write, or produce more courses without thinking in terms of scarcity.
- 38:42 A donation wouldn’t alter my course, it would be a catalyst or an accelerator. Right now, I’m fronting the cost of bringing people on the network. Eventually, that’ll be something we’re generating revenue from, and expenses will come out of that revenue, but initially we’ll have to get traction. I’m fronting those costs, and I’m fine with that, but it’s a limiting factor. I want to bring Cory Miller on full-time to be our product manager but I’m not to the point where I can say, “I can afford that, come on any time.” It’s difficult to be able to commit to consistently meeting a five figure payroll. You might think if I make five figures a month, it must be easy but when you’re scaling and trying to bring people on and you have to consistently meet that, it’s the whole “job security” facade. When you work for someone it seems secure but someone is having to stick their neck out there and make ends meet.
- 40:11 Ben: It’s definitely not what it appears from the outside to be. As transparent as you’ve been about the kind of money you’re earning and spending on maintaining the business, my brain has a hard time looking at this from the outside, even with the inside perspective. It’s hard not to have unrealistic ideas about what it looks like and I have to tell myself the realities of it. It’s not a fight for every penny, but you’re bootstrapping. You didn’t go out and get a business loan for millions of dollars to launch a network, you’re doing this on your own. The fact that you’re at the place you are right now, having bootstrapped, is phenomenal when you think about it but that can create a false perception for somebody looking in on the outside. Maybe it’s because other people have experienced similar success but with much greater resources at their disposal because they’ve taken on investors.
- 41:38 Sean: It’s a mental thing. When you’re looking at things from the perspective of where you are now and you look to the next level—like if you’re making four figures a month and you look at someone making five figures a month—it looks substantial. You try to imagine your current lifestyle times whatever that factor is and you think, “Wow, that’s got to be amazing!” but really, it’s only like that if you want to limit yourself to only ever accomplishing that much. If you want to get to the next level, you have to put it right back into the business. You can’t lifestyle creep! When revenue goes up, you can’t increase your lifestyle or it becomes a habit. It creeps up on you. It’s not something you’re always consciously doing but if you’re not consciously preventing it, it will happen to you.
Is the world better off with a small handful of things you’ve slaved over by yourself to make 98% perfect, or would the world be better served by 90% quality at a much grander scale?
The one resource you can’t get back is time.
Not Selling Out
- 43:14 Ben: I can’t imagine the amount of patience you have to exercise when you’re bootstrapping as a visionary person, like yourself. There’s a difference between your time being inherently valuable and being able to command a certain amount for your time. You may be putting a lot of value out into the world but, monetarily speaking, you might not see returns on it because you don’t have the notoriety or influence to command what your time is really worth, so you’ve got to build that.
- 44:13 You spent years doing that with your lettering and client work before what you’re doing now. You spent a lot of time building that value before you ever started to see returns coming in. If you’re doing it the right way, the value of your time continues to go up and the amount you’re able to command for your time sits just below that but creeps up with it. I think people go the investment route because they don’t think they can do it any other way but I also think they’re being impatient. They want to see their vision come into reality so badly that they’re willing to compromise on their values to get there.
- 45:42 Sean: To speak to the mindset thing again: every time you get to the next level, it’s like you have this little pop-up dialog box with the option to settle there or keep going. Is this the springboard to the next level or have you arrived?
- 46:22 Ben: There are multiple game shows out there with that structure. If you answer the question right, you can choose to walk away with a certain amount of money or you can choose to go to the next level. You may fail and walk away with nothing. There’s also some shows that have fallback amounts, so if even if you get the questions wrong, you’ll still walk away with whatever amount you locked in.
- Don’t Fall Into the Lifestyle Creep Trap
- 47:10 Sean: You have to start with defining a comfortable lifestyle—the lifestyle you want—and then not allowing that to change. You see the business as a totally separate thing and you’re just being sustained in being able to run the business. That works when your goal isn’t just to be rich and have a bunch of money, but you have a greater vision of something you want to accomplish. You have to see it as, “If I don’t cash out here and I put this money back into the business so it will grow and I can scale, then I can help more people.” That mindset is the only thing that will get you from four figures a month to five figures, and five figures a month to six figures a month, and so on. It scales.
- 48:24 Ben: I read an article a while back about startups and how selling out your startup is a negative thing. If you develop some new technology and you get to the place where the big names want to throw cash at you for it, this article was saying the annihilation of that product once it’s taken over by the big name is a tragedy. Even if the big company carries on the spirit of what that technology was originally intended to do, it’s lost it’s parents so it’s not going to continue to grow in the direction it would have naturally. If you think about that in terms of the seanwes brand and you’re trying to grow your business by taking on investments, you’re spreading the vision out to other parties.
- 50:40 Sean: I have some fairly unconventional views and uncompromising values and I think that has resulted in being where I am now. Who knows what would happen if I allowed that to be diluted and allowed people to make decisions that didn’t align with that?
- 50:40 Ben: In the chat room, we were talking about the reason some people seek investors is because they’re impatient and they want to see their vision come to fruition faster. To that Justin says, “Impatience isn’t always a bad thing. If humans were immortal, we would all still be hunting and gathering because there would be no pressure to accomplish things in the limited time we have.” I love that because it’s so true. I didn’t mean to point to impatience as a bad thing. We can channel impatience into healthier ways of doing business that won’t always bring us the same result that time investments might, but will definitely keep your values intact and will bring you to a pure version of the vision you originally had.
With a donation, you get to see your vision come into reality sooner without having to compromise on your values.
Time Is a Limiting Factor
- 51:43 Sean: It’s not unlike creativity. Time is a constraint and creativity flourishes within constraints. You might be inclined to think the more freedom you have to do whatever you want, the more creative you can be, but that’s not true. Creative energies come from being in a place where you have to think strategically to work within constraints (Related: e096 Boosting Creativity By Reducing Choice). Time is a limiting factor. It forces you to be creative as you go through life and realize more and more it’s a finite resource. Suddenly, you reach the end of your life and you want to do more. Money becomes less of a factor. You’ll spend money to get time. You’ll do things you may not have otherwise done earlier in your life to get time because time is so important. Recognizing that limited time factor can help you be more creative in your business and maybe that means it’s not bad to accept a donation from someone who believes in what you’re doing and wants to help you accomplish more in less time.
- 53:15 Ben: On one hand you don’t want to have a Scarcity Mindset because that can be paralyzing and can keep you from taking any action at all. It can keep you from making bold decisions you might not have otherwise made. While at the same time, the scarcity of time, resources, and people can bring about some of the most creative solutions that you’re capable of. If you had a huge donation at the very beginning, would you have learned the things you’ve learned? How differently would the seanwes brand look today because you weren’t put through that fire? In that sense, scarcity is a wonderful gift because, if you channel it in the right way, it can lead you to doing some very creative things and can shape the way your brand looks.
- 54:51 Sean: Don’t have a Scarcity Mindset to where you take on whatever work you can get, but recognize the limited resources you have and be creative in how you use them.