Erik’s Blog: Board Shorts and Business Suits

In response to my previous article asking should I go to business school I’ve jumped full force into researching what it takes to start a legitimate business in the eyes of investors. True, if you’re making money hand over fist who cares if you have a well defined structure.

But if you want to truly learn about business and how they function and also learn a lot about the market you’re trying to corner, a business plan can be invaluable. So why the heck haven’t I written on for the 4 business ideas I’m currently involved in? Laziness.

Business plans take time. Even though I feel I have a good grasp of what I’m doing or want to do, I feel a business plan would rocket me way ahead of where I am right now. Not just cause you have this document but because of the steps it take you to create the document. The research it brings you into to make the document.

So with that, I’ve begun a little bit of research myself and have found several resources that I think would interest a lot of you internet entrepreneurs out there.

For starters here are the main things a solid business plan consists of:

1. Executive Summary - It’s the general overview of the business you are planning to run and the history of it and it’s founders and main employees.
2. Market Analysis - You gotta know if you can make money in the market before you can ask others to invest in your business (that includes bank loans)
3. Company Description - How your business jives and why you think doing one thing will help the others
4. Organization & Management - Who are the key players in your business and how are you going to organize the flow of work
5. Marketing & Sales Management - Who and How are you going to get your product in front of people and who’s gonna sell it?
6. Service or Product Line - What are you selling or offering and why is it better than whats out there?
7. Funding Request - How much money do you need and why?
8. Financials - Where are your financials right now and should you be trusted with money?
9. Appendix - All the nitty gritty details of the numbers listed above.

You can find out info about this outline and tons more at:

SBA .gov How to Write a Business Plan - Obviously a resource on how to write a business plan
Sample Business Plans for Internet Related - Lot’s of plans deal with restaurants, these deal with applicable plans to my readers.
Hundreds of Business Plan Examples - Huge resource of example plans
Online Startup School - Some good free resources especially the 101 tips .pdf file
A List Apart Small Business Advice - Mainly geared at freelance designers but good info for all.

Hope these links keep you all busy for a while. They are definitely keeping me busy.

I don’t follow many conferences that go on. I live out here in Hawaii and getting back to the mainland for work (at my “real job”) and lately, for friends weddings is usually all I see, so following conferences is kinda pointless. But this one got my attention.

I am a regular reader of Jason Calacanis’ blog. i love his controversial writing style. He writes things that spark conversation and ultimately more creative thinking. So when I recently read that he and Mike Arrington of TechCrunch were doing a conference together, I had to check it out.

It’s called the TechCrunch20 and it’s going to bring together the 20 newest and most intriguing (to them I assume) new companies to show their products to the “press, VCs, investors, and bloggers.”

The best part is, it won’t cost these companies squat. It appears the conference is going to be setup so these companies can present their goods and get immediate feedback from these groups of people.

Even if your product gets ripped to shreds by some of the biggest names in the Web2.0 world, you’ll still more than likely get some amazing coverage in some of the biggest blogs and newspapers there are. Plus VCs like to invest, and 20 isn’t a large number. My guess is most of these are pre-picked winners and will likely get some primo funding.

Tickets to the event aren’t cheap…
$1,995 if you register by July 15 and $2,495 up til September 10, 2007.

Yikes. I guess if you gotta go it’s worth it. Maybe Blogtown Press will have the budget available by then?

Here are a few links to wet your entrepreneurial appetite and keep you going at those website empires that most of you are building.

1. The first link is a list of the 10 most successful web 2.0 startups to date. The requirement is that the sites be web 2.0 in nature (kind of a fuzzy requirement) but the list is great and shows some very organized data; Founders, date founded, monthly pageviews, and valuation. Some of the craziest numbers are…

Myspace gets 40 billion pageviews per month
Wikipedia’s target audience is 10-80
Digg was rumored to be in negotiations for $150 million

2. Here’s some great advice for a successful blog launch. I’m thinking of launching a few new blogs for the Blogtown Press Blog Network and this post was a great refresher course. It also obviously got dugg to the front page too. Some good points that I’m sure to follow this time around.

Don’t launch your blog without at least 5 posts… I’m going for more like 20 posts, or 30-50 posts in the saved post pile. I need to have consistent posting from the get go.
Include outbound links. I don’t really do this enough and it’s one of the great things about blogs. Especially when linking to a wordpress blog, who doesn’t look at their inbound links dashboard?

3. Here’s a sweet idea generator blog with fresh news about new business ventures. It’s called SpringWise.com. They have a ton ideas, not all really applicable to the low investment types. Some of the companies they profile would take a real investment team. But knowing what’s out there and what’s new can get you more in touch with your creative side!

4. I’m including this one because I wanted a good place to reference it besides my bookmarks section. It’s called the Startup Venture Toolbox and basically has a list with resources and an explanation about why should think about looking at those links. It’s like a startup checklist!

I’d like to start out by saying IMHO, real-life anything experience is more valuable than what you can learn in schools. With that being said. I’d like to follow that quickly up with saying going to school, whatever it is, can help you in ways real-life experience can’t.

So which one is it?

I’ve already gone through the undergraduate degree learning all the world of biomedical engineering had to offer. Now I’m working at a start-up company in Hawaii, learning about product development, both the business side and the engineering side, as well as learning the workings of a company trying to create value in anothers investment.

On the side I’m also working to try and build legitimate businesses, mainly through the internet. The reason for building businesses on the internet is that you can more easily build assets with little to no money, just using time.

In doing all of this business building I’ve been contemplating what the potential plus side would be to going back and getting a Business Degree, possibly and MBA, through a night masters program here in Hawaii. I would continue to work at the current startup I’m at while also going to classes but would most likely need to stop building my own businesses. I do most of my business building at night, when I’d be going to class and doing homework.

So I ask you this? Would I learn more trying to setup my own businesses, learning a more organized approach, teaching myself. Or would I be better off learning those approaches through schooling?

First off I want to say that I didn’t spend more than a minute at the site. Just long enough to sign-up and notice that during sign-up and right afterwards the site doesn’t tell you what it’s about.

The site I’m talking about is Geni.com and was recently talked about over at Tech Crunch. I guess when you have the likes of Tech Crunch and Jason Calacanis talking about your site you are going to get a lot of people to sign up and that could bring you some money.

But a valuation of $100 million with $10 mil in second round VC funding is a bit high for a site that currently makes no money. Seems a little bubblish if you ask me.

I guess there are a few roads that the company could take to monetize and it’s an interesting idea. Getting your family members involved and showing where they are in the world. Sounds something right up Googles alley and a drop in their bucket in terms of buying it. Google did buy dodgeball.com.

Social networks are great for kids; Myspace, Friendster, FaceBook, etc, and even good for entrepreneurs LinkedIN (ish). But trying to get the baby boomers of the world to come around to a social network based on their family tree? I have a hard time getting some of my relatives to use email correctly.

I think it’s gonna be a hard road is my opinion. I’d really like to see where they take it. I guess with $10 million you might be able to send out a few fliers with the monthly AARP membership papers.

In my recent series about buying and selling domain names I talked a lot about the basics of where to look for an easy revenue earning domain name. The thing I didn’t really talk about was what are optimal click through rates (CTR) or how to optimize domain names that might not have optimal click through rates.

I again stress that I’m not an expert in this subject and have limited experience (6 months) and above that know only as much as I’ve read, which is freely available information. However, since I wrote that article series I’ve had several people inquire about what optimal CTR’s are for domain names at parking sites. So I’ll dish what I feel I know.

First off, when you’re buying a domain name like I described in part 4 of the series using low earnings multiples to buy domain names as well as few other tips, you need to also think about what keywords the domain names are using as well as the click through rates the domain names are receiving.

Before you Buy

I’ll start off by looking at CTR before you buy a domain name and how

From my experience an average CTR of 20% is good, that’s what I strive for in my portfolio and I feel like that’s a good benchmark for parked domains. If you can get 1 in 5 people that visit your parked domain name to perform an action, you’re on the right track. Of course there are ways to boost this and some people boast 50% returns, but if you look for a modest 20% CTR you’ll be good.

Before you buy the name or while you’re looking at names, as I explained in part II of buying and selling domain names, you’ll want to look at what the seller has for a CTR. If it’s around 20%, considered it optimized, for your own sanity. Of course if you have a way of turning parked domains into a 40 or 50% return, consider a 20% CTR a bargain, but that’s not what I’m talking about here and you probably wouldn’t be reading this.

If the domain name has a lower CTR like 10% or even 5%, then you need to put in some more research. Find out the keywords that are used if any, look at the category used. Do you have a similar name in the same category, but using a different keyword that you’ve optimized for cost per click (CPC) and/or CTR? If so, then you might have found a bargain.

But be careful, sometimes names just don’t receive a high CTR. Especially certain typo’s. Some typo’s that people get to aren’t going to people clicking. They get to the parked page and realize it’s not where they’re going. However, you may be able to coax them into a click if you choose the right keywords, so be on the lookout.

After You Buy the Name

If you’ve found a domain name that has a lower than 20% CTR or that isn’t using a high paying keyword you may be able to change some things around to increase one or the other.

A lot of parking services allow you to change the look of the parked page. Surprisingly, different looking pages can have different effects for different categories of domains. You need to play around with the page layout to get the highest CTR you can. I usually choose a standard search result looking page but have begun to venture into other layouts as I do more research in the forums.

Another method of increasing the CTR and possibly the CPC is to futz with the keywords used at your parking service. Like I mentioned earlier if you find a domain name that wasn’t optimized with high CPC keywords but is in a category where you know of high paying keywords, you might have found a bargain. Be weary though, the keyword might not work with that domain.

In closing, if you stick with the rule of thumb for 20% CTR, you’ll be doing well. That’s what I work off of and it’s served me well so far. I’m going to venture into higher paying and higher conversion rate methods for domain name monetization, but that’s a whole nother series in itself.

I found this post via problogger, I know shocking, blog news found first on problogger.net, but I had to share this with you all.

Since my audience is predominantly Internet entrepreneurs I thought you can never have too many buying and selling websites articles. I mean, most of us would sell off all our Internet real estate for the right price, and people are realizing a blogs value more and more as the days goes by and the “blog fad” doesn’t fade.

Well, how much is a blog worth, and how do you compare one to the other. Although a lot of what a blogs worth is tough to quantify a recent article on the Blog Herald titled Selling Your Blog: What Others Are Looking For is an amazingly comprehensive article on just that. Figuring out what blog buyers want and what they’ll pay for.

The article covers a ton of topics, tells of what might be weighed more than others and why, and gives examples of how to begin the valuation of your blog. Or at least begin tailoring your blog to bring greater value to it.

Head over and check out the article. Oh and to give credit it’s an article by Lorelle VanFossen who writes Lorell on Wordpress, a blog I admit I’ve never been to but have added it to my “keep an eye on if I have time to read” list. Nice work Lorelle!

As you know my brother and I are trying our hats as entrepreneurs, me building a blog network on the Internet, and he designing a clothing line. I have mentioned before that he got the art-creative side of things in the family and is super talented when it comes to design (although he won’t tell you that, and will probably smack me for saying so).

He launched his clothing line about 3 months ago with a limited edition run of shirts he hand designed. He’s also teamed up with SurfAid to donate some of his proceeds to their great cause of helping impoverished towns brought together through surfing. His concept is awesome as he is using his creative talents to help the world and bring people together.

He recently announced the addition of two sponsored riders, a surfer named Chase Fisher out of Southern California, and a surfer out of Hawaii, Morgan Hoesterey. These are great additions to the As One team to help spread the word about helping others.

Check out the surfers and check out his newest releases of clothing over at the As One Shop.

For those of you who don’t know, BlogCatalog.com was recently sold over at sitepoint marketplace forums for a whopping $40,000. The site itself is one of the biggest and best directories for blogs around, very well known, the name itself is very brandable and worth a bit.

On top of that the site makes $1700 a month on what I would consider very very very minimal ad placement. Someone could take the traffic blog catalog sees and turn it into a very profitable service without ruin the clean look. An entrepreneur could do this and do it well.

$40,000 / $1700 = 23.5 months earnings. Are blogs going to be around for the next two years? Chances are very good. Could the new owners expand blog catalog to offer more services to bring users back, increase new traffic and use a better monetization scheme to make more money that $1700 a month? Definitely.

And I didn’t even mention that the $1700 was purely from AdSense. AdSense that’s placed on average, one time per page!

So what can we learn from this recent website sale and transaction. Well, by the small case study I’ve provided above you can see several things, some of which I point out in my recent buying domain names article. The person who bought this site bought a lightly monetized site, with huge potential. They bought it at a relatively low earnings multiple considering the outlook that blogs are here to stay. No matter who says the blog bubble might burst.

I haven’t even mentioned the biggest part of buying blog catalog. Not only do you buy the biggest blog directory you also buy what amounts to a ginormous and very focused email list. Everyone who submits to the Blog Catalog needs to give their email address. Now I just google searched my gmail and noticed that I only recieved emails from the time that I submitted. That’s it.

You have to see the potential in other aspects of websites. Forums, directory submissions, blogs and sites with lists like this, all of those can be monetized from so many directions. You just have to be creative. The new owner could put together a sweet eBook, like the “AdSense is Dead” eBook, that I imagine really didn’t say a whole lot to help you make more from (sorry I didn’t read it so I can’t do a great review.)

You can also use that new list to launch other websites, products, and more! By buying a site like that you open up so many more possibilities by giving you a huge audience. You have to try and see all the possibilites that a website acquisition could bring you.

I would imagine that it completely depends on your application but while I tinker with my blog layout I’m also considering what the best design is for different optimization routes.

I’ve recently displayed my disgruntled-ness over text-link-ads.com, mainly why aren’t they selling as well as others. I chalked it up to, after snooping the TLA listed pages, to the fact that it seems pretty random which blogs get more links than others.

Some people have commented that I sold another link, and you can see that yes it’s true. But I must confess, I sent out about 15 emails to people that I noticed bought links on other sites until I finally got one to bite. And trust me it ain’t price, I’m still at the cheapest in TLA.

But I digress….

The real reason for writing this post is to consider and look at what others do and how well they’re TLA spots are selling as well as other factors in selling more space and over all giving the professional blogging look.

The first blaring difference between blogs that sell a lot of TLA space and my blog is that they have their ads in a single sidebar on the left-hand side of the page. Some examples are Flee the Cube, Blotrepreneur, Problogger. OK, the last one really isn’t fair.

But I ask you this is there something to a single left-hand bar?

Will I gain more advertisers? does it look cleaner? I’m not sure, I’ve played with both and dig the two-bar righty but I’m no optimizing wizard and would rather not re-invent the wheel. Which brings me to the fact that b5media, weblogsinc, and Yaro over at Entrepreneurs Journey all have double right-hand sidebars, but….

They have traffic too. I like the way the double right looks. It puts your content up front and center in the viewing path but does it hurt your bottom line?

As I mentioned I’m no expert, so I’d love your opinions?