There Is No Excuse For An Unprofitable Business...
My name is Jeff Kikel and I am the Founder of three businesses that include a Coworking space with two locations, a Wealth Management practice that specializes in working with business owners and a training company that focuses on educating business owners on how to build profitable businesses.
Now I know you are thinking, wow this guy is a serial entrepreneur, right?
I hate that term because it assumes that I was born out of the womb being an entrepreneur. I spent more than 25 years of my life working as an employee. I do not come from an entrepreneurial family, my parents worked for others their entire lives.
My journey toward entrepreneurship and starting my own companies started on October 2, 2003. On that day I was laid off from my job working in the financial services industry. I was the typical “Company Man” that felt like I would work for that company for the rest of my life. That day changed everything.
Fortunately, I was allowed to stay on with the company and eventually moved into a different role that was a better job. However, what occurred on October 2, 2003, never left me.
Every week, I lived for the weekend and could not wait for it to get there. On Sunday afternoon each week, my stomach would tighten up as I would anticipate going into work the next morning.
Every Monday morning when I would reach the office I would hesitate as I placed my security badge to the reader. I would relax when the reader allowed me in, knowing that I had made it another week.
My wife and I traveled the world extensively during this time, but every time I came home the same thing occurred when I went back to work.
I know this sounds psychotic, but this is the world that I lived in for over 12 years.
By 2015, I had had my fill of working for others and began listening to a podcast called Entrepreneur On Fire by John Lee Dumas. After binge listening to this podcast for a few months, I realized there were people like me that had decided to go out on their own and create businesses. I realized that I was no different from these people and decided to open my own business.
As a budding entrepreneur, I began to look for a problem that I could solve. One challenge that I saw was a lack of office space for small businesses. Most of my small business friends met at coffee shops and restaurants with the clients. We all needed a professional place to meet.
T-Werx Coworking was born.
We launched our business and filled our offices relatively quickly, however, we really did not understand who our ideal customer was, or have any financial controls. We also did not have a good financial model that priced things correctly. We just worked hard to sell. By 6 months later, we had exhausted our startup funds and were in financial trouble.
We experienced a problem that many entrepreneurs run into. In the beginning, you are just buying “stuff” because you think you need it and have the money. Until the money starts to run out.
When our first summer hit, we began to see one of the challenges of coworking. Small business owners decide to take the summer off to be with their kids, so they really don’t think they need to pay for a coworking space. 30% of our members decided to do this. While they saved money, we still had the same expenses.
We were in trouble. My wife and I cut out any compensation and actually had to take money from savings to keep the space afloat. By mid-summer it became desperate and I had to start working “Gig Economy” jobs to keep us afloat.
In August of 2017, we actually contemplated closing our doors because we were not sure how we could be able to continue. This was the breaking point that a lot of businesses experience. We have all heard the statistics between 50–60% of businesses are gone by year 5. I believe that most of these occur prior to 18 months, a period which I refer to as “The Suck”.
The next 6 months were awful. I worked 12 hour days at my businesses (I had also restarted my financial practice by this point) and then worked an additional 6–7 hours in the evening at various “Gig Economy” jobs. For someone that had a respected standing in the community at this time, I had to suck up my pride.
It was at this point that I decided to figure how to break through the wall that had been placed in our way and what had caused it. In the end, the wall was caused by us. While in the beginning, we had a clear forecast for the business, we didn’t follow it.
After analyzing our predicament I came to the realization that with some tweaks and discipline we could make our business profitable (although it would take some pain). I also realized that any business could experience immediate profitability if they followed some simple rules.
Secret #1: The Fundamentals
First, we needed to focus on the fundamentals and develop a customer avatar, create Vision and Mission, set high-performance goals and focus on our Financials. This required us to develop better forecasting and financial modeling. We had to make hard decisions and cut our expenses to the bone.
I also realized that I need to manage my time more effectively if I was going to be able to run two businesses successfully and survive. This was done by managing my schedule and hiring my assistant Cindy, who I could not afford at the time (more “Gig Economy”).
Secret #2: Modern Business Tools
We had to look at the tools we were using in our business and make sure that all were working for us. In modern business, you have to have a High Converting Website which answers the questions: “Who are you?” “What do you sell?” “How do I buy from you?” If your website does not answer these questions, it is useless. Anything else on your website is extraneous and unneeded.
A modern business should also be using Sales Funnels to walk your clients through the buying process. This was something that we were lacking.
Once you have a customer’s email address, you need email marketing to keep fostering and growing the relationship with them. Whether you are using promotions, following up after a sale, periodic customer service check-ins or you are trying to directly sell to them, automated email marketing is required to be successful today.
The final component was Social Media. This was the area that we did extremely well and had been what helped us survive during our dark days. My Director of Marketing barraged all of our social media channels with information and helped us build SEO and awareness.
Secret #3: Harness Automation and Create Other Streams of Revenue
Once we got our expenses under control and made sure that we were effectively using our tools, we could now focus on how to drive greater revenue.
At this point, I began to learn about automation and how I could use it to make our business more efficient. I have reached a point now that when I meet someone at a networking event, I snap a picture of their business card and their information is added to both of my CRMs, added to my email automation program, an email is sent to them requesting a 1:1 and one to my assistant letter her know all this occurred.
At this time, we looked for other ways to build revenue outside of space rentals, which led us to my third business, Profit Producers.
I had seen too many of my friends that were outstanding experts in their field go out of business during the last few years. I wanted to stop this from occurring by teaching other business owners what we had learned.
We build programs to help entrepreneurs grow their businesses by applying the principals that we know worked in our business.
Summiting the Mountain
After coming out of “The Suck” our businesses became stronger and better.
T-Werx has experienced significant growth and we have opened a second location in Austin. My financial practice BKA Wealth Consulting has grown significantly in 2018.
The best of all of this has been the growth of Profit Producers, which was built using all of these strategies that we had learned. Profit Producers was profitable within 30 days of its founding and will remain that way if I have any say in it.
What have I learned over the last 15 years of my life?
After living my life in fear of losing my “safe job”, I have reached the top position in all of my companies and the only one that can fire me is me. While stress has not gone away for me, it is a different stress than I used to have.
I no longer have that knot in the pit of my stomach on Sundays, I wake up on Monday excited to get into the office and do the things that I love doing every day.