7 ms·

How to Get Good at Making Money

198 points by 6ren 15y ago

asanwal 15y ago
I'm not sure this article will show you "how to make money" (I doubt any article can do that). Nevertheless, there were some gems in here that seem to contradict or generally undiscussed as part of the current startup zeitgeist & ethos. "Making money is not the same as starting a business" - A lot of the conversation, content, advice, etc today seems about the "art of the start" which is about fundraising, customer development, etc. Those may be necessary but definitely are not sufficient to having a business. "...from Day One, a funded business is all about spending money...Anyone can spend money. Making it is the hard part" Gary Vaynerchuk had a similar comment about us celebrating the fundraise. Again, fundraising is a worthwhile and perhaps useful milestone, but it's a means to an end which should ultimately be building a real sustainable business. These points are what you'd expect from Jason Fried, but it was refreshing to see nonetheless.
- medinism 15y ago
  I am especially fond of the make money from your customer advice - under boot-strapping. Sure there are biz that will make $ in the long term from having large volumes of something, but for the rest of us, charge early!
chunkyslink 15y ago
Duplicate: http://news.ycombinator.com/item?id=2271421 http://news.ycombinator.com/item?id=2271421 The printer friendly version is actually nicer to read:)
brc 15y ago
I love the idea of buying and reselling the same item to see if you can make money. Very good.
- codexon 15y ago
  This advice is horribly outdated stuff from the 90's. With Ebay and Paypal fees eating up at least 10% of your earnings, it is highly unlikely you can just resell iPods or anything else on Ebay and make a profit. "I love doing this, because there's no real risk involved." No real risk except losing all the money you've invested and wasting a lot of time making Ebay entries and repeatedly learning how to pack and ship.
  - cantbecool 15y ago
    I agree. Ebay, Amazon, and Paypal eat up every penny of profit that you would make as a reseller.
    - mootothemax 15y ago
      I agree. Ebay, Amazon, and Paypal eat up every penny of profit that you would make as a reseller So all those resellers on eBay are losing money? And distributors lose all of theirs to credit card fees as well?
  - brc 15y ago
    The idea is not to make money, well, not in the sense of making earnings from it. You're not meant to take it literally as in 'make money from reselling stuff on ebay'. Of course you lose in the transaction fees (it also mentions craigslist). Of course you're not going to make real money doing this. The point is to sharpen your sales skills and realise that experimentation and refinement is the key to developing a good sales strategy. It goes back to the central theme of the piece, which is to continually drum on things - practising all the time. Of course drumming on the steering wheel isn't applicable to playing in a band, except that it's all mental stimulation and practice of sorts.
    - codexon 15y ago
      The point is to sharpen your sales skills and realise that experimentation and refinement is the key to developing a good sales strategy. This is like saying the point in picking up trash at the highway will be refining your work ethic. Sure it helps, but you could be doing something more efficient. Note how he says to find something that is a "commodity". A commodity by definition is a product that fungible, which means for those of you who haven't taken Econ 101, no one cares who they get it from, they only care about how cheap it is. This tells me that Jason Fried doesn't know what he is talking about even though he made everyone's favorite Ruby on Rails company.
mhartl 15y ago
s/money/wealth/g
losethos 15y ago
With my 3 Axis milling machien... failure With SimStructure, no body cares. No body pays for shareware. LoseThos... sshhiite God says... C:\LoseThos\www.losethos.com\text\HAMLET.TXT s not divide the Sunday from the week; What might be toward, that this sweaty haste Doth make the night joint-labourer with the day: Who is't that can inform me? Hor. That can I; At least, the whisper goes so. Our last king, Whose image even but now appear'd to us, Was, as you know, by Fortinbras of Norway, Thereto prick'd on by a most emulate pride, Dar'd to the combat; in which our valiant Hamlet,-- For so this side of our known world esteem'd him,-- Did slay this Fortinbras; who, by a seal ----------- With LoseThos, I learned reality is broken. Imagine trying to start a business when your reality is a psychology lab rat or something. Or, some government agency thinks you are a UFO alien. Or, God and Angels are really befuddling egverything. You gotta fix reality before you can start a business. Reality is totally fucked-up. God says... na_na yep didn't_I_say_that astronomical hymns birds I'll_be_back I'll_think_about_it pardon_the_french liberal could_it_be___Satan If_had_my_druthers Oy what_do_you_expect you_don't_say
phatbyte 15y ago
I couldn't agree more on points 5 and 6.
ra 15y ago
So many gems in this article, like this: " Whether you're playing drums or building a business, you're going to be pretty bad at something the first time you try it. The second time isn't much better. Over time, and after a lot of practice, you begin to get there."
kghose 15y ago
Small point that puzzled me: He said he got a reseller's license to buy stuff for himself from distributors, and he mentioned he bought "a" radar gun. I thought distributors only sold in bulk and the discount only came out because of the bulk part.
- ovi256 15y ago
  Of course, that's "mostly" true. But he was a sixteen year old with a reseller's licence. Most people love to help a kid out. So I'm pretty sure that's what happened, he talked to them and the rules were bent. That's an even more important lesson that should be spelled out: rules are for shy people who are afraid to ask. That reminds me of a passage from Jobs' biography. When they started prototyping the Apple I, Woz needed memory chips. But those were expensive and available only in quantity, so they would be hard to get for a prototype. Jobs just called and got the manufacturer to send some samples. That blew Woz' mind.
  - zrail 15y ago
    I've done that trick with chips a few times. Manufacturers want to sell you huge bulk supplies and their costs are so low for things like simple logic or ADC chips that they'll send you a single tube of them just for asking.
- jasonfried 15y ago
  You could buy one item at a time from the Ingram Micro D catalog. I believe bulk prices were even cheaper, but you could still buy items individually below retail prices.
billpatrianakos 15y ago
I absolutely love the guys at 37signala. In particular, their writing style. I recently bought Rework and it was an incredibly easy to finish book, fairly short, but at the same time packed full of more information than books I've read that were twice as long on the subject. I like the ideas put forth here. Sometimes we forget about these basic concepts like the fact that we deserve to be paid fairly for our work. How simple is that?! I know I lose sight of it all the time. I've been in business for a year (2 weeks is when my 1 year anniversary is) and I now charge ten times as much as I did the first month I started and I still have to raises prices a lot more. This isn't a good thing. It's bad because I obviously undersold myself because I lost sight of the fact that I'm giving something valuable to someone and I should be well paid for it. Instead I felt guilty for charging when I was enjoying my work. Most of their writings on business is so simple but profound (to me at least). From what I've read, it all boils down to making sure you're being paid for your work, always see if there's a better way to do things, and your business should grow into itself instead of fitting into someone else's mold (e.g. Following business advice that doesn't apply to what you're trying to achieve just because everyone else is doing it and that's what you "should do". ). I also love the fact that they're Chicago boys. I always root for the home team, haha. I have a friend who knows Jason Fried and I really hope I get an introduction one day.
CosmicShadow 15y ago
You know when you hit the Readability bookmarklet and say "god this is just beautiful", this is one of those situations.
ilaksh 15y ago
"I realized that when customers shop for shoes, they do three things. They consider the look and style. They try them on to see if they're comfortable. And they consider the price. Endorsements by famous athletes help a lot, too. But the technology, the features, the special-testing labs—I can't remember a single customer who cared." Does this apply to software or online services? What do those customers really care about?

198 points by 6ren 15y ago

I'm not sure this article will show you "how to make money" (I doubt any article can do that). Nevertheless, there were some gems in here that seem to contradict or generally undiscussed as part of the current startup zeitgeist & ethos. "Making money is not the same as starting a business" - A lot of the conversation, content, advice, etc today seems about the "art of the start" which is about fundraising, customer development, etc. Those may be necessary but definitely are not sufficient to having a business. "...from Day One, a funded business is all about spending money...Anyone can spend money. Making it is the hard part" Gary Vaynerchuk had a similar comment about us celebrating the fundraise. Again, fundraising is a worthwhile and perhaps useful milestone, but it's a means to an end which should ultimately be building a real sustainable business. These points are what you'd expect from Jason Fried, but it was refreshing to see nonetheless.

medinism 15y ago
I am especially fond of the make money from your customer advice - under boot-strapping. Sure there are biz that will make $ in the long term from having large volumes of something, but for the rest of us, charge early!

chunkyslink 15y ago

Duplicate: http://news.ycombinator.com/item?id=2271421 http://news.ycombinator.com/item?id=2271421 The printer friendly version is actually nicer to read:)

brc 15y ago

I love the idea of buying and reselling the same item to see if you can make money. Very good.

codexon 15y ago
This advice is horribly outdated stuff from the 90's. With Ebay and Paypal fees eating up at least 10% of your earnings, it is highly unlikely you can just resell iPods or anything else on Ebay and make a profit. "I love doing this, because there's no real risk involved." No real risk except losing all the money you've invested and wasting a lot of time making Ebay entries and repeatedly learning how to pack and ship.
- cantbecool 15y ago
  I agree. Ebay, Amazon, and Paypal eat up every penny of profit that you would make as a reseller.
  - mootothemax 15y ago
    I agree. Ebay, Amazon, and Paypal eat up every penny of profit that you would make as a reseller So all those resellers on eBay are losing money? And distributors lose all of theirs to credit card fees as well?
- brc 15y ago
  The idea is not to make money, well, not in the sense of making earnings from it. You're not meant to take it literally as in 'make money from reselling stuff on ebay'. Of course you lose in the transaction fees (it also mentions craigslist). Of course you're not going to make real money doing this. The point is to sharpen your sales skills and realise that experimentation and refinement is the key to developing a good sales strategy. It goes back to the central theme of the piece, which is to continually drum on things - practising all the time. Of course drumming on the steering wheel isn't applicable to playing in a band, except that it's all mental stimulation and practice of sorts.
  - codexon 15y ago
    The point is to sharpen your sales skills and realise that experimentation and refinement is the key to developing a good sales strategy. This is like saying the point in picking up trash at the highway will be refining your work ethic. Sure it helps, but you could be doing something more efficient. Note how he says to find something that is a "commodity". A commodity by definition is a product that fungible, which means for those of you who haven't taken Econ 101, no one cares who they get it from, they only care about how cheap it is. This tells me that Jason Fried doesn't know what he is talking about even though he made everyone's favorite Ruby on Rails company.

mhartl 15y ago

s/money/wealth/g

losethos 15y ago

With my 3 Axis milling machien... failure With SimStructure, no body cares. No body pays for shareware. LoseThos... sshhiite God says... C:\LoseThos\www.losethos.com\text\HAMLET.TXT s not divide the Sunday from the week; What might be toward, that this sweaty haste Doth make the night joint-labourer with the day: Who is't that can inform me? Hor. That can I; At least, the whisper goes so. Our last king, Whose image even but now appear'd to us, Was, as you know, by Fortinbras of Norway, Thereto prick'd on by a most emulate pride, Dar'd to the combat; in which our valiant Hamlet,-- For so this side of our known world esteem'd him,-- Did slay this Fortinbras; who, by a seal ----------- With LoseThos, I learned reality is broken. Imagine trying to start a business when your reality is a psychology lab rat or something. Or, some government agency thinks you are a UFO alien. Or, God and Angels are really befuddling egverything. You gotta fix reality before you can start a business. Reality is totally fucked-up. God says... na_na yep didn't_I_say_that astronomical hymns birds I'll_be_back I'll_think_about_it pardon_the_french liberal could_it_be___Satan If_had_my_druthers Oy what_do_you_expect you_don't_say

phatbyte 15y ago

I couldn't agree more on points 5 and 6.

ra 15y ago

So many gems in this article, like this: " Whether you're playing drums or building a business, you're going to be pretty bad at something the first time you try it. The second time isn't much better. Over time, and after a lot of practice, you begin to get there."

kghose 15y ago

Small point that puzzled me: He said he got a reseller's license to buy stuff for himself from distributors, and he mentioned he bought "a" radar gun. I thought distributors only sold in bulk and the discount only came out because of the bulk part.

ovi256 15y ago
Of course, that's "mostly" true. But he was a sixteen year old with a reseller's licence. Most people love to help a kid out. So I'm pretty sure that's what happened, he talked to them and the rules were bent. That's an even more important lesson that should be spelled out: rules are for shy people who are afraid to ask. That reminds me of a passage from Jobs' biography. When they started prototyping the Apple I, Woz needed memory chips. But those were expensive and available only in quantity, so they would be hard to get for a prototype. Jobs just called and got the manufacturer to send some samples. That blew Woz' mind.
- zrail 15y ago
  I've done that trick with chips a few times. Manufacturers want to sell you huge bulk supplies and their costs are so low for things like simple logic or ADC chips that they'll send you a single tube of them just for asking.
jasonfried 15y ago
You could buy one item at a time from the Ingram Micro D catalog. I believe bulk prices were even cheaper, but you could still buy items individually below retail prices.

billpatrianakos 15y ago

I absolutely love the guys at 37signala. In particular, their writing style. I recently bought Rework and it was an incredibly easy to finish book, fairly short, but at the same time packed full of more information than books I've read that were twice as long on the subject. I like the ideas put forth here. Sometimes we forget about these basic concepts like the fact that we deserve to be paid fairly for our work. How simple is that?! I know I lose sight of it all the time. I've been in business for a year (2 weeks is when my 1 year anniversary is) and I now charge ten times as much as I did the first month I started and I still have to raises prices a lot more. This isn't a good thing. It's bad because I obviously undersold myself because I lost sight of the fact that I'm giving something valuable to someone and I should be well paid for it. Instead I felt guilty for charging when I was enjoying my work. Most of their writings on business is so simple but profound (to me at least). From what I've read, it all boils down to making sure you're being paid for your work, always see if there's a better way to do things, and your business should grow into itself instead of fitting into someone else's mold (e.g. Following business advice that doesn't apply to what you're trying to achieve just because everyone else is doing it and that's what you "should do". ). I also love the fact that they're Chicago boys. I always root for the home team, haha. I have a friend who knows Jason Fried and I really hope I get an introduction one day.

CosmicShadow 15y ago

You know when you hit the Readability bookmarklet and say "god this is just beautiful", this is one of those situations.

ilaksh 15y ago

"I realized that when customers shop for shoes, they do three things. They consider the look and style. They try them on to see if they're comfortable. And they consider the price. Endorsements by famous athletes help a lot, too. But the technology, the features, the special-testing labs—I can't remember a single customer who cared." Does this apply to software or online services? What do those customers really care about?