This is My Story“Man who chases two rabbits, catches neither”
- Confucius
When opportunity comes knocking at your door, sometimes it’s best not to answer.
Four years ago I made the decision to lose focus. My business, The Marketing Spot, was a small, growing company less than three years old. But in April of 2004, I decided that instead of running one business, I should run two. So I began publishing the Waco Real Estate Source, a free real estate magazine for buyers. It was a decision that has cost me time and money.
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| Flickr photo by irene nobrega |
Oh, everything was fantastic at first. And exciting! I had something new to sell, a tangible product. People called me to advertise in my magazine. It was distributed all over town and people saw my name in print as the local publisher.
I started hearing, “Hey, you’re the Source Guy.” Yes, and no. Really, I was The Marketing Guy, not The Source Guy. Real estate publishing wasn’t my dream. It had nothing to do with the vision of the company.“Only when it’s too late does a company turn around and notice that they have become unfocused, perhaps precariously so.”
- Focus: The Future of Your Company Depends on It by Al Ries
What it Cost Me
“Look at me! I’m a serial entrepreneur.” Or maybe I was just full of myself.
Fast forward to one year ago. In the summer of 2007 I was flying high. My business was more profitable than it had ever been. It seemed my juggling act was working! But there was something waiting just out of sight to knock the balls out of my hands. It was called the mortgage crisis.
When the subprime roof came caving in, I was still in the house. Real Estate Source advertisers started dropping like flies. I quickly lost 25% of my business. More was on the way. But I couldn’t spend additional time with The Source to replace lost revenue. Half my time was already spent on The Marketing Spot. I couldn’t focus.
By November 2007, I was losing money. Not with the Real Estate Source, but as a company. Two halves did not make a whole. Each passing month brought another loss. It was a death spiral for the business and I had to jump off to survive.
So as of June 2008, I am no longer The Source Guy. Thank God. "No one can serve two masters. Either he will hate the one and love the other, or he will be devoted to the one and despise the other.”
What I learned
Matthew 6:24
Breaking the Law of Focus is an exercise in opportunity cost. Now that I am able to focus on the original vision of the company, I can complete projects that have been on the drawing board for some time. Sitting on my “to-do list” are video and online marketing training programs for small businesses, an ebook, plus two books I am planning to write.
I learned a lot while publishing the real estate magazine. But just because you are learning, or networking, and even making money, doesn’t make it right. My dream got clouded, my vision got fuzzy.
“Only when you focus a company or brand over an extended period of time do you develop a powerful company whose future success is almost guaranteed.”Stay Focused
- Focus: The Future of Your Company Depends on It by Al Ries
Maybe you are not trying to run two businesses. That doesn’t mean you're focused.
Are you sending out more than one marketing message? Is your brand picture cloudy? Are you trying to be all things to all people? If so, then you are breaking the Law of Focus. It will cost you.
By focusing on the one thing that will define your business, you open a path that leads to your vision. And you avoid the frustration that comes from chasing two rabbits.
Believe me, I know. Learn from my pain.
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12 comments:
How do you feel about the education you received, as problems unique to your other venture manifested and needed to be dealt with?
Cam,
There's no doubt that I learned how to handle unique problems that I wouldn't have otherwise confronted. Still, it's an education that exacted a heavy tuition.
I think I would have preferred to learn another way.
Hi Jay,
Thanks for sharing your story and your pain - always a great motivator and eye-opener.
I believe that "focus" is the most important part of running a business. You can have the best brand in the world, but if you dilute it via brand extension and / or lack of focus, the power of its influence will inevitably dissipate. Although "focus" is a crucial factor in growing business, it still seems to be one of the most difficult actions to maintain and manage...for many, many reasons - including entrepreneurial excitement and enthusiasm. :)
I just wrote about this today with "5 Guiding Principles" marketers can use to help maintain focus and determine priorities:
http://diablogue.wordpress.com/2008/06/20/5-guiding-principles-for-marketers
Thanks again for sharing and reminding us of the Focus book by Al Ries, which is truly a classic gem...still timely and relevant.
Best wishes to you,
JP
Great points. I think it is exponentially more difficult when you are working on two businesses at once, although I would argue it is sometimes necessary.
@JP I'll admit that I was overtaken by what Michael Gerber (E-Myth) calls the "Entrepreneurial Seizure" when I decided to start publishing the magazine.
My lack of focus was in the area of attention. In Focus Ries points out that companies have a natural tendency to lose focus over time. One of my sins is that I had read Focus several years prior to losing mine.
@Chuck I'm sure it's possible to run two businesses at the same time, but I don't think you can run and work in two businesses at the same time. Both of my businesses were small, and I did much of the work in both.
Jay,
SO well-said! This may be my favorite post I've read from you. A lot of owners struggle with focus. This post makes the difficulty of "two masters" personal and universal at the same time.
This must have been a difficult decision for you. I hope you are feeling some relief now, and I hope it's given you renewed energy for your core business.
Thanks for such thoughtful and revealing writing.
Regards,
Kelly
Thanks for your comment, Kelly. The decision was not that difficult, the process was. It took about three months to divest and I could say nothing about it during that time.
But you are right, I am feeling relieved and invigorated.
Great post Jay. I agree completely, focus is crucial for a small business to be successful. Is this also a lesson for not relying on only one revenue stream? If two years ago you had focused only on the real estate magazine, would you have survived the mortgage meltdown or would you have lost your entire business instead of half of it? While not being focused is bad, focusing on the wrong project/business can be even worse.
That's a thought-provoking question, Jason, and you make a good point. Of course, it's difficult to answer outside of speculation. But I'll do my best.
The magazine will survive, and is surviving under different leadership. The revenue I lost was all net profit to my business. My fixed costs remained the same. The flaw was that I had structured my company to run two businesses, but only one was paying for itself.
I agree with you that it can be deadly if your focus is misplaced. However, that's a matter of being Tuned In, the title of the new Stull, Myers, and Scott book I'm reading. (I'll review that book in the next week or so.)
Jay, Thai is a really great post that hits home, Thank You for sharing, I appreciate that; It is pretty easy to get distracted from what your focus should be. Last year we were involved in a local Street Fair, which ate up most of our resources for a couple of weeks leading up to and then the weekend event. While we won Best of Show for our booth, met a lot of folks, etc, we had our lowest Net Rental Month ever, and the event was in the summer. I am not saying there isn’t value in local participation, but we took our eye off the ball and it cost us a couple months to catch up rentals. Sometimes our Form of Measurement can get skewed too, for us it is Net Rentals, and we missed the mark by participating.
Jay-
This is a valuable lesson for all small business owners, myself included. Aren't those lessons that we "purchase" from the "school of hard knocks" so daggone expensive! (I've had many.) Thanks for sharing your story.
Skip Lineberg
@Eric We have a natural tendency to get unfocused. At the time those things seem like a good idea. It's tough to weigh the opportunity cost when situations like that come up.
@Skip Yea, it's kind of like a business "student loan."
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