What an amazing journey The Zig Zag Principle has been!

I want to so publicly acknowledge and thank all of you that have been involved in this great endeavor. 

There are two types of victory.  There is the private victory and there’s the public victory.  I am so thrilled about the public victory! We hit the bestselling lists!

- We were #3 overall on Amazon the day the book was released. On Amazon we also hit:
- #1 on the Movers and Shakers list
- #1 in Business Management
- #1 in the Motivational category
- #1 in Entrepreneurship
- #1 in Psychology and Counseling
- #1 in the category Life

We are #5 overall on the USA Today list.

And the public victory I am really excited about is that The Zig Zag Principle is the #6 bestselling book in Inc. Magazine. 

These listings stand for great public successes and victories. But the successes that I am the most excited about, is you.  I love the private successes. 

I get to hear the stories from individuals who are wresting control of their life. I love the stories of people take back their life—both emotionally and financially. These are the success stories that I am the most excited about. 

I thank you again so much for your support in The Zig Zag Principle and I hope that you will join me in having a zig zag, joyful, amazing, successful life.  Thanks again so much for supporting me on The Zig Zag Principle. Go forward and have a great prosperous life.

 I do have some businesses that do not fit into these last two categories but have been very stable businesses that have scaled well.  My wife and I started purchasing rental properties many years ago.  We bought our first fourplex at a fire sale after the owners went bankrupt.  We put enough money down that the cash started flowing from the moment we bought it.  As we obtained more cash, we paid off this property.  Through trial and error, we have been through the learning curve to know how to manage these rentals.  With the money we made from that first rental, we bought another rental property.  We added resources by hiring a repairman and other people to help manage the properties.  We hired our sons to work on these rentals, as this was a great way to teach them how to work hard. (I’d hire my daughters, but we don’t have any.)  One by one, we purchased rental properties that got us to cash, paid them off, and then purchased more.  The great thing about these properties is that they are income-producing assets.  Even as the housing market took a nosedive, our rentals remained full.  Those people who no longer qualified for mortgages needed places to live and were happy to live in our rentals. 

      When my partners and I started CastleWave, we first got our initial SEO contracts to drive us to profitability, and then we hired the engineers we needed to build our resources. Then it was time to add scale.  The scale component in CastleWave was our link-building component—the ability to get other authoritative web sites to direct traffic to the sites for which we were consulting.  Our expertise in this area was our number-one value asset.  We put together a pragmatic system—aset of processes and approaches that were bundles—that we could then have our employees replicate and follow, allowing my partners and me to focus on other issues. 

      If done properly, scale allows you to develop a system and train other people in how to use that system. Put together an entire system and process using all your rules of engagement, and then flip the switch and start cranking out the cookies.  A cookie-cutter system is what will get you to scale.

      Microsoft Windows is a great example of scale.  How many times did Microsoft build Windows?  Yes, Bill Gates and company have released updates and improvements (well, most of the time), but they really only built the program once!  And they have been able to sell it millions and millions of times over.  Virtually every PC sold has Microsoft Windows already installed, and Microsoft gets a royalty each time a person opens their box.  Now that is scale—and the reason why Bill Gates is one of the richest men in the world!

I have developed four rules I follow whenever I create a business.  There are times I violate them, but I do so deliberately.  Keep in mind that these are my rules that fit into my skill set and values.  You will need to look at your own situation and determine the rules that work for you. 

Rule # 1 – Ride a Wave:  I like businesses that are on a wave.  Just like a surfer who gets in front of a wave and rides it to the shore, I want the environment to be right before I get on a wave in my business or my life.  If the wave is big enough, then just being in its vicinity will generate enough power to propel you toward your destination.  But if you catch that wave wrong, life can come crashing down around you.  The key is to get on and off the wave at the right time.  September 12, 2001, would have been a terrible time to start an airline.  This same day would have been the perfect time to start an anti-terrorist airline security business.  Purchasing a row of new condos in 2006, when housing prices were at a point where experts were beginning to see they were unsustainable, would have been a bad move.  Purchasing those same condos after the housing bubble burst and prices were slashed in half would have been the right time to add scale.  You need to assess your environment and pick the right waves to ride.

Rule #2  – Transaction Businesses:  I like businesses that sit in the middle of a transaction.  A well-known example is credit card companies, which make 2-5 percent every time one of us slides our credit card through a reader.  None of us give what we’re paying a thought (and if you think we’re not paying, think again).  Merchants are happy to pass along the fee because the convenience brings more people to their business.  Customers love the convenience of not having to carry cash or write a check, so they willingly pay their annual fee (and high interest rates) as well.  Positioning yourself in the middle of a transaction puts you in a great place to make money.

Rule #3 – Own the Customer:  I like to own the customer.  I don’t like being in a business where I can’t look into the eyeballs of the customer and resolve the issue.  I like to be in the middle of the transaction, but I do not like being sandwiched between brokers.

During the rise in the housing market, I was riding a great wave with a company called Mortgage Saver 101.  We had an awesome web site that generated leads of people looking to obtain mortgages.  The company was riding a wave and was a transactional and a digital business.  The only problem was that we did not sell our leads directly to the banks or the people who were coming to refinance their loans.  We sold our leads to a broker who would then sell them to multiple vendors.  Many times the broker would come back to us and say he did not like some of our leads.  We would ask what he didn’t like and he would simply say, “It wasn’t a quality lead.”  Without being able to talk to the bank or the customer, we were left to guess at what they really wanted.  This left us very vulnerable, giving all of the power to the broker.  If there was a problem, we had no way to solve it.  On the other hand, credit card companies are good examples of being able to own the customer.  The credit card company can communicate directly with the merchant that is selling the product or the customer that has signed up for the credit card.  They own the customer.  They can manage the relationship on both sides of the transaction.

      Rule #4 – I Like Digital Assets:  This is my very personal preference, but I love digital assets.  I really do not like retail.  Why?  Because I stink at retail.  I don’t have enough discipline and I am not patient enough to succeed in retail.  It doesn’t scale as well for me.  I know many other people who have been highly successful in retail, but it is just not my preference.  Once I make a website or an application, I have made it once and as many people as want to come will fit into that store.  That’s the primary reason I like digital assets. 

At one point or another in our personal lives and our careers we get into a desperate mindset or a desperate mode of operation. I found this to be incredibly destructive, and actually counter productive.

As we slip into this mode you can typically tell because the volume and intensity with how we approach our customers, our clients, our employees, and everyone else is just notched a little bit too loud. At what point you want something so badly that you can’t do without, you know you are doing desperation.

My wife tells the story of driving through our little town and seeing a big poster on one of the little mom and pop clothing stores. The sign said, “Please shop here. I need to feed my children!”

That’s doing desperation. A person’s first thought is, “Oh, I’ll help out that shop owner.” But then that thought is quickly followed by another, “Oh, I don’t want to fall into that trap.”

Here are three things that I’ve found will help you avoid desperation not only in your business life, but also in your personal life.

Number one, put a buffer in place. Inevitably you’ll hit bumps in your personal life and in your business life. I put a three-month minimum savings buffer in the business. And I maintain more than that in my personal life.

Next, don’t risk what you can’t afford to lose. If you’re not in the position to risk at the level that you’re risking, that causes an extreme amount of desperation. So don’t risk what you can’t afford to lose. Before hand make a conscious decision and determine your level of risk.

Finally, if you do get into the desperate mode of operation…back off. Take three deep breathes. Consult those around you. Take a backdoor approach to it. If it is just simply beyond recovery—punctuate it. Don’t go deeper down the rat hole.

I frequently talk about my philosophy of failing efficiently. If you’re going to have a failure and you’re chasing it down the rat hole. Don’t keep following after it, to an even worse death. End it. Put that one to bed. Move onto the next thing.

I know this is an easy topic to discuss intellectually. But emotionally it’s a very difficult topic. I still find myself in modes where I’m doing desperation. I experience this particularly when it’s beyond my realm of control. When I put everything out there and it’s out of my hands, I often struggle with desperation.

I do strongly suggest that we stay in a positive non-desperate, non-threatening mode. Things just go much better in that mode. The putts fall better. The business comes together. Everything flows better and it is much simpler when you’re not in desperation mode.

Go forward, zig zag to success, and have a wonderful week.

 One way would be to bring another dentist into his practice so he could take Fridays off to work on creating his new product.  He could then join forces with other local practices to build a channel or infrastructure to test and promote his new product.  When that has proven successful, he could create an online presence.  When we talked about his options, my friend was amazed that he could take control of his own destiny and move from the constrained “I’m going to spend the rest of my life drilling teeth” mindset to the “I can actually pursue my beacon in the fog” mindset.

      While others see limitations, I see examples of scale all around me.  I found one while attending a retreat being run by a well-known chiropractor.  This man is clearly an exceptionally talented chiropractor who had become very profitable in his practice.  He then added resources and staff and was able to add several additional offices to his practice.  Then he made the big leap to scale.  He compiled his own set of processes that worked in his business, including the equipment he used, the supplements he recommended, and the processes that made him successful.  He put all of this together into a system he could sell to other chiropractors.  This man is now distinctly known for his training programs among chiropractors throughout the United States.  With his training program, he helps other chiropractors—and then profits when they tell their associates about what he’s done for them. But he has no direct involvement in their day-to-day businesses.  This is scale.

      My oldest son seems to have gotten some of my genes, which led to him getting involved in my web businesses several years ago.  (He was one of my original nerdy kids who helped me move CastleWave forward.)  After I sold CastleWave, he wanted to start his own business.  He worked hard to follow the principles and processes he learned at CastleWave and ended up building a scalable web business of his own.  His is now in Japan for two years working as an unpaid service volunteer, and he has a business that is still making money for him.  While he is gone, his seventeen-year-old brother is the CEO of the company.  He also hired his younger brother and several other smart and energized teenagers to keep his business going—and growing.  They have the same values in place.  They have their beacon in the fog set and are fueled with the passion of youth.  As I write this, my son has been gone for thirteen months, and he has a resource and an asset that will fund the remainder of his college when he returns.  That is the power of scale.

The third zig is about adding scale to your undertaking. After getting to cash and then adding resources and processes, you need to add scale to get your product or services to the masses. In simple terms, scale is something that can be published or duplicated or sold over and over again.  Think about the music industry as an example.  There are amazingly talented studio musicians who get hired to play for top recording artists.  They come into the studio, lay down their tracks, get a check for an awful lot of money, and then go onto their next gig.  They live a good life, making more than most of us.  The trouble is, their check is a one-time payment.  On the other hand, the artist who writes and records the song gets a royalty every time the song is downloaded, sold at Wal-Mart, or played on the radio.  Through scaling their talents and business strategies, recording artists gets lots and lots of checks for an awful lot of money—and live a great life!

Business gets really fun for me when I can make money while I’m sleeping, or on vacation, or working on my next project.  I remember the first time this happened for me. I was laid up in bed for what I knew was going to be a few weeks, so I came up with a little business idea, threw together a web site, worked my search engine optimization magic, and went to bed.  I got up the next morning, brushed my teeth, checked the web site, and found I had made $37.50—while I had been asleep!  (That number got bigger as the days went on.)  Scale is what allows me to do that.

My colleagues and I often use the term, “Nail it, then scale it.”  What we mean is that during the first two zigs and zags, you’re really trying to figure out how to nail your business.  You’re figuring out the discipline, the effort, and the processes that will make it work.  In zig number1, you are figuring out how to get to profitability.  In zag number 2, you are adding resources.  In zig number 3, you need to figure out a model that you can replicate quickly and get your product out to the masses.  This is the “scaling it” part.

When I’ve talked or written about this concept, I’ve offended several members of my family because I summarize my ideas by stating, “I never want to be a doctor and certainly never a lawyer!”  My point is not to offend my brother, who is a very successful doctor.  My point was that doctors have to put on their literal rubber gloves and poke at some very tender places, and attorneys have to put on their figurative rubber gloves and poke in some dark places. Otherwise, neither one is making money.  I don’t want to do that.  I like making money beyond the time that I am physically and/or mentally working. 

There are alternatives most of us can pursue, though.  I have a good friend who is a dentist.  He’s told me several times about a really great product he wants to develop that would make it so much easier to fill cavities.  He has lamented that he just doesn’t have enough time to work on this because he is stuck drilling and filling teeth all day long.  He feels he has no options, but I’ve explained that the option is to zigzag.  He already has a business with a solid cash flow.  He just needs to add resources—and then scale. 

We launched the book The Zig Zag Principle and within a day it hit #1 in every applicable category on Amazon. And then we hit #3 on Amazon’s Bestseller List. What fun this is seeing the results of the last several months of hard work.

I appreciate the positive comments and reviews from everyone. I’m enjoying this fun ride. And now it’s time to celebrate!

Please join us at our launch party this weekend. We’re going to celebrate The Zig Zag Principle with a party and a set of fun workshops designed for entrepreneurs, aspiring entrepreneurs, and anyone else who is interested in business and goal setting.

If you have tickets, please make sure you are registered for the event. We have incredible content to share, amazing food to devour, and a whole lot of celebrating to do.

If you’d like to attend, please contact our office today. Someone from back East purchased a large number of books and donated some of his launch event tickets, and we’d love to make sure they get used. Please contact us at 1-801-375-7900. First come, first serve.

THE ZIG ZAG PRINCIPLE LAUNCH PARTY
- Workshops, Speakers, Fun & Games, and Networking.

- Learn how other kids, teens, and stay-at-home moms have zigzagged to build businesses.

- Lunch is provided.
   
Saturday, October 15th
SALT LAKE AREA

For more info, to register, or for tickets, please click or call: 1-801-375-7900

I have to share an interview I did with an incredibly smart and entertaining entrepreneur, Andrew Lock. When he started the interview by asking me questions about which types of hamburgers I preferred, I knew I was in for some fun. After all, on Lock’s site it says his show, Help My Business Sucks “…has become more popular than a supermodel at a Catholic boarding school.”

But don’t let all these jokes fool you–Andrew is a brilliant entrepreneur who has been at it since he was a kid. Anyone can watch his free, weekly Web TV show. Learn about starting a business, running a business, marketing, and more. Or as Lock says learn to “get more done and have more fun.”

I’d love for you to watch this interview where Andrew Lock and I discuss business, being an entrepreneur, bootstrapping, and of course–The Zig Zag Principle. We even talked a bit about which cookie reigns supreme. Please enjoy the interview and come back again to for the next episode of this wildly popular show, Help My Business Sucks.

Next week is the week of good books! The Zig Zag Principle is releasing Tuesday, and my good friend Randy Garn is releasing his book Prosper—Create The Life You Really Want next week as well. I’m excited for both events because I love a good story about success, especially when it features zigzagging entrepreneurs.

Randy and his co-author Ethan Willis are zigzag entrepreneurs. They have worked in the eCommerce, real estate, investment, and the personal development sectors; zigzagging their way to success. Garn and Willis’ new Prosper Book is a great read because it shows people how to find prosperity and still maintain a balance in life.

Life balance is hugely important whether you’re an entrepreneur or not. It’s something I preach and strongly beleive in, and it’s just one reason I think this new book is important. Within the pages of Prosper Book you willl learn the following skills and techniques for finding prosperity and life balance.

   1. Find your personal Polaris Point:  What is guiding your life?
   2. Balance money and happiness: Get your Polaris Point and your living in alignment.
   3. Earn from the inside out: Mix your passions and your profits.
   4. Focus on what you already have: People who emphasize what they already have, usually end up with the most.
   5. Create and commit to a plan: Decide to live the life you really want.
   6. Take profound, continuous action: Persist, persist, persist.

I’ve said it before, and I’ll say it again…right now is a great time to be involved in entrepreneurship! Now is the time to get educated and take your destiny into your own hands. Entrepreneurship is your ticket to prosperity. Check out Prosper—Create The Life You Really Want and learn how to control your prosperity and maintain your life balance.

Also remember to take part in the fun events we have scheduled surrounding the launch of the The Zig Zag Principle.

On the flipside, at this same time I made a couple of horrific hires, in part because we didn’t have our value system clearly in place.  During this time I was literally living off three to four hours of sleep a night and I hired an executive assistant who had a good resume, but what impressed me even more were her outstanding grades and recommendations. I had some concern that her work experience was a bit thin; but I needed someone quickly, so I hired her assuming her grades indicated a solid work ethic. 

One week while my partner, Ron, and I were working a trade show in Florida, I kept trying to call into my office.  I tried at several different times, but I just could not make contact with my new assistant.  I finally called another recent hire who was supposed to be at the office.  She did call me right back and said she was on a short lunch break and would call me back, which she failed to do. After four days of not being able to reach anyone, I called my wife and asked if she would go by the office and find out what was going on.  When she arrived, the front door was locked and all of the lights were off.  She found the main telephone was set to voice message.  She did find an engineer in a back room, where he was working on a project.  When she asked him what was going on, he told her that these two women, who were supposed to be answering my phones and greeting people, had decided that since I was gone that they would “work from home” that week.

Needless to say, I had to terminate both these women when I returned from my business trip.  I made the mistake of hiring two young women who weren’t hungry for the work I offered and who had a safety net at home that would rescue them.  I also made the mistake of not screening them effectively against my organizational values, one of which is that we value hard workers. 

Since that experience I have learned to not be too busy to pay close attention as I add resources.  I’ve also developed a series of questions and skills assessments that I run potential hires through, especially my executive admin, who I believe is my most important hire. 

One of my best hires is a woman named Colette Marx.  She is a mother who, by mutual agreement, is working for me from her home (which is yet another way to conserve resources).  When I hired her, I gave her a copy of my book, Bootstrap Business, and told her she needed to read it and then take a test.  The other people I hired at the same time all went home and skimmed through the book.  But Colette wanted to succeed at this job; so she read the book, and then she went back and read the book again, this time highlighting it and making copious notes. When she brought it into the office to take the test, it was dog-eared, it was tagged, it was well used.  Not surprisingly, Colette scored a perfect score. She’s the only one to have done that.  (She even scored higher than I did, and I wrote the book!)  Colette didn’t come with the strongest resume or the most extensive experience, but she is one of the most committed and engaged employees I have ever had. 

We’d like to introduce you to one of our brave souls that will be joining Team Zig Zag down in St. George, Utah for the Triathalon. Nathan Gwilliam has taken on this challenge to join our team to swim, bike and run–all in the name of The Zig Zag Principle. Since his youth, Nathan has been a goal setter. In high school he read The Seven Habits of Highly Effective People by Stephen R. Covey, and it changed his life. Since then he’s set goals that have molded him into the successful entrepreneur he is today. He likes to say, “If you don’t know where you are going, you’ll never get there.” This attitude makes Nathan the perfect addition to the Zig Zag Principle Tri Team.

You’d think the finish line would be his favorite part of the triathalon, but it’s not. Nathan loves the training leading up to the big day. He really enjoys training as a team–especially when it’s a team of good friends. Also, Nathan said he enjoyed improving his time and working toward better health. But, if he had to pick a particular part of the race that’s his favorite, he says that he’s most comfortable with the running.

Nathan has quite an impressive resume on and off of the field. Currently he is the owner of Social Nexus, an organization that grows world-class Internet, mobile, and social ventures. Meaning he can help you with:
Digital Strategy
Design & Development
Social Marketing
Digital Monetization

He has zig zagged all over the place from founding Adoption.com and building it into the world’s most-used adoption service to developing the initial strategy and site for Law.com. He has built a variety of other ventures, such as Families.com, Ofertas.com.br (a Groupon competitor in Brazil), Viajamos.com.br (a Brazilian travel social network) and WeSpeak.com (a language-learning social network).

With such a varied and impressive background, Nathan has great advice for the apsiring entrepreneurs.

From an early business failure, Nathan learned that entrepreneurs can become very distracted on things that don’t matter. The best advice that he would give a new entrepreneur would be to focus on getting your product to market as quickly, inexpensively and effectively as you can. The power of stability comes from profitability.

Nathan said it’s important to understand a few business myths:

• He believes in the rule of 3’s….It always costs 3 times more than what you think to get your business going and you end up with ? of the profit. Therefore Nathan strongly believes that bootstrapping a business is where it’s at. Do anything possible NOT to borrow investment money.
• Another one is the myth about entrepreneurs ~ that they are risk takers. The reality of it is that they don’t take “more” risks, they just take “calculated” risks.
• And lastly, that being an entrepreneur is unstable. The truth is, if you own your own business, you will be the last one to get fired! You have more stability working for yourself than working for a large company.

In conclusion, Nathan says “Life is so short, pick something you love and something that makes a difference. Not just something that makes you a buck, but something that makes a difference. You’ll have left the world a better place when you retire.”

Best of luck Nathan to you with your Zig Zagging during the race and with all your business adventures!

Jonathan Kaplan, maker of the Flip Video camera, is finally zig zagging closer to his beacon in the fog. That may seem an odd statement considering Cisco killed production on Kaplan’s baby project, Flip Video cameras, earlier this year, but you have to remember that zig zagging is about taking indirect steps to get to your goal. And Kaplan’s goal? Grilled cheese sandwiches.

Kaplan has had a dream of building a grilled cheese sandwich restaurant chain for years, but understood his idea was premature. He understood that though he had the mental capital his idea needed to be profitable, he did not have the relationship capital he needed.

Now, Kaplan has had two businesses he sold: #1. Family Wonder to Sega, #2. Flip Video to Cisco. He zig zagged both to success, and in the wake of Flip Video getting scrapped, he now has everything he needs to build his years-old dream. He has the mental capital, the relationship capital, and he also has plenty of financial backing to turn The Melt, his grilled cheese restaurant, into a nationwide chain. Kaplan hopes to have 500 The Melt stores open all over the U.S. within five years.

Kaplan is also smart enough to use a different goal to get people his employees and customers motivated. Though he has the goal of opening 500 stores in five years, he doesn’t use that as a catalyzing statement. Instead, he talks about using grilled cheese to make people remember their childhood. He talks about bringing customers happiness and nostalgia in every sandwich and in every cup of soup, not just a delicious meal. Listening to him talk in this interview makes me anxious to go and try what he’s talking about myself!

Until The Melt comes to Utah or I make it to San Francisco, I’ll just have to keep an eye on this savvy zig zagger and see where he goes next.

Subway Directions:

1. Look up

2. Look Down

3. Look up

4. Look Down

5. Look up

6. Look Down

7. Look up

Now I am not talking about the subway in New York, even though it would be a similar to these instructions: look up and look down. Indeed you have to look up and down often as you board, watch for your stop, and read the map. So indeed, those instructions are very appropriate and applicable for any rapid transit. However; the subway that I am speaking about is a hike in Southern Utah.

If you know me, you know that I love the metaphor of the mountain. Well, today I did a little canyoneering deep into a slot canyon. This hike is about 10 miles long, beautiful, and a perfect activity for my family. The Subway is probably my favorite hike in the entire world.

The first thing we did was look up to see the beauty of the canyon, then we looked down to ensure a good footing. Throughout the day we followed this sequence: 1. Look up to see the views. 2. Look down to see the obstacles that we are attempting to overcome as we are traversing down steep terrain. 3. Look up at the gorgeous canyon around us. 4. Look down very carefully as we swim underneath rocks, carefully traverse logs, or pass over a very difficult rock slide. The entire day was a sequence of zig zagging.

The mountains are a brilliant example of zig zagging, but I have to tell you that canyoneering is an even better zig zag analogy. Even though we are heading in a general direction, we are continually climbing over and up and around obstacles. We wouldn’t have even made it five minutes without killing ourselves if we hadn’t zig zagged through that day. Additionally there was a tremendous amount of looking up and down. The encouragement that I give to everyone, not only in their business, but also in their personal lives, is this. Look down. Make sure you’re on track and avoiding the big obstacles. But for heavens sake, take time to look up to enjoy the beautiful things around you.

We hit one point where there were these amazing dinosaur footprints on a huge slab of rock. But we had to look up to see that. If we had just been looking down at all the little obstacles and stumbling points, we would have completely missed the entire experience.

Now how ironic is it that often times the real joys in life comes from those tricky little traverses. There is one place called the choke stone, where we literally are swimming in freezing cold water. We have to dive underneath the water, turn sideways and go underneath a log and then continue this crazy, big-hairy swim. It was scary! Every time I do it, it makes me a little uncomfortable. Now that we’re done, what do you think my entire family is talking about? They’re recalling that tricky traverse.

Then at the end of the hike there is a steep climb. It takes a lot of endurance to climb out of that canyon. Indeed in life and in business traveling the path takes a lot of hard work.

Let me leave you with a little advice I’ve been contemplating on the hike. Look down, pay attention to the details, but don’t forget to look up and enjoy the beautiful things around you. Both in life and in business take time to savor your sweet experiences.