The Voluntary Life: May 2013

29 May 2013

110 Who To Start A Business With

This episode is about things to consider when choosing co-founders to go into business with. Topics covered include:

  • Do you need co-founders?
  • The advantages of choosing co-founders who are different to yourself (in background, skills, personality, and business networks)
  • The importance of shared core values and purpose for co-founders
  • Research by Noam Wasserman shows that teams made from former co-workers are the most stable. Teams made from former strangers are the second most stable of the three groups Wasserman analysed. Teams made from friends and family are the least stable.

Show Notes:
The Founder's Dilemmas by Noam Wasserman
The Millionaire Next Door by Thomas Stanley
The Wisdom of Crowds by James Surowiecki

Podcast Episode

24 May 2013

109 Getting Started With Bitcoin

An interview with Stephanie Murphy, co-host of the show Let's Talk Bitcoin, about getting started with using Bitcoin. Topics covered include:

  • What is Bitcoin?
  • How Stephanie first got involved with using Bitcoin
  • Exchanges and exchange services: changing fiat currency into and out of Bitcoin
  • Software, wallets and technical issues
  • Security issues
  • Buying things with Bitcoin
  • Selling your services and products for Bitcoin

Show Notes:
Let's Talk Bitcoin podcast
Porc Therapy podcast
Fr33 Aid charity
We Use Coins (intro video about bitcoin)

Podcast Episode

15 May 2013

108 Three Ways To Delegate

This episode is about three approaches to delegating work within your business. No business can grow unless the founder is able to delegate work to a wider team of people. It's essential that tasks are properly delegated and that the business owner doesn't abdicate responsibility. However, there are three very different ways to delegate:

  • The Operations Manual Approach is where detailed standards and procedures are defined for how all tasks are to be undertaken. Work is typically undertaken by relatively inexperienced employees, who learn to follow detailed specifications.
  • The Results Only Work Environment is where employees are given clear targets or results to meet and it is up to them how they do so. They create their own work procedures and have maximum freedom on issues like whether to work at home.
  • The Outsourcing Approach is where work is delegated to independent contractors or virtual assistants. Fixed costs are kept low by avoiding hiring employees as much as possible. Work is typically outsourced on a specific fee-for-project basis.

The episode explores the advantages and disadvantages of each of these approaches.

Show Notes:
Anything You Want by Derek Sivers
The E-Myth Revisited by Michael Gerber
Maverick by Ricardo Semler
Rework by Jason Fried and David Heinemeier Hansson
Why Work Sucks and How to Fix It by Cali Ressler and Jody Thompson
The 4-Hour Workweek by Tim Ferriss
How I Found Freedom in an Unfree World by Harry Browne

Podcast Episode

9 May 2013

107 What Kind of Business Should I Start?

If you want to become an entrepreneur but are not sure what kind of business you would like to start, what framework can you use to help you decide? There are two things to consider that will provide you with a strong advantage:

1. Starting a business to create a solution that you will be a customer for

This is sometimes called "eating your own dog-food". To be successful, all businesses have to deliver value to customers: they have to make something that people want. If you use the product or service that your company makes, it helps you understand whether it is providing value.

2. Starting a business in an industry that you understand

Industry experience provides valuable knowledge about the opportunities and constraints that your business will face. Some examples of industry knowledge are:

  • knowing where your potential customers shop
  • understanding why they buy
  • knowing how potential distributors or affiliates work
  • understanding what the major concerns of key contacts for your business are

If you don't make something that you yourself would be a customer for and you don't have a good understanding of the industry, you are flying blind. Try to develop a business where you have at least one of these two advantages. Also, try to increase your awareness of the aspect that is missing.

Podcast Episode

3 May 2013

106 Self-Employed Vs Business Owner

This episode is about the pros and cons of being self-employed vs being a business owner. Both options have advantages and disadvantages, but mixing the two does not work well.

In the self-employed/freelancer model, you sell your time, cover your own expenses and keep all profit. This works best when you have a valuable skill and lots of industry contacts, as you are able to undercut bigger companies on price but keep your overheads low. If it works, you get the advantage of a lot of flexibility to work or take time off.  The disadvantage is that you are dependent on work for income, so there is much less financial freedom in the long term. You don't build up value in business itself (nobody wants to buy a job) and it can be hard to keep your overheads low for longer (as you may need to start investing in marketing, new equipment etc). So it's a vulnerable model over the long term.

The business owner model is the idea to create a value generating machine. The focus here is on developing standards and procedures to make yourself (the founder) unnecessary to the running of the business as quickly as possible. The advantage of this model is that you create an income stream and a source of value (the business itself) that you can sell in the future, or live from as passive income. This has the potential for much greater financial freedom as well as the freedom to step away from the work in the longer term. The disadvantage is that you have more risk in the initial period, as businesses take more investment. You also get much less free time in the initial period, as the startup phase of a business is more stressful than freelance work.

Either model can give you a lot of benefits, but be careful not to get stuck between these two models- you can end up with all the stress and none of the benefits. If that happens, it isn't creating a business, it's creating a job (and the worst kind of job, because you can't stop doing it). I hope this podcast will help you be conscious of which model you are adopting and to move more clearly to one or the other if you are currently stuck in-between.

Show Notes:
The E-Myth Revisited by Michael Gerber
The 4-Hour Workweek by Tim Ferriss
Anything You Want by Derek Sivers

Podcast Episode