Chapter Three

Great Is The Enemy Of Good

Often, entrepreneurs give up because they get disheartened when they don't succeed overnight. Everyone wants to be successful, but success is won in small milestones along the way. When starting your business, don't expect to open your doors to a crowd on the first day. Building a company takes hard work and perseverance. Prepare yourself to achieve small goals and gradually improve business over time. Zach Ferres, CEO of Coplex writes in his article: 5 ways to celebrate small wins on your way to world domination, about why small wins matter. He eludes that the completion of small milestones reduces fear and increases the probability of early successful outcomes.

The ability to show a quick win is a boost to morale. Striving for perfection will make us spend far longer on things than we need to at this point in the process. Remember we are still in the planning phases and are trying to get everything ready for launch. We want to grow a great company, one unlike the world has never seen before. However, this can be tricky as the illusion of staying busy getting something perfect can actually hold you back from achieving the greatness you want.

Jim Collins is the author of some of the greatest management and leadership books in the market currently. If you haven’t read his book Good to Great, you should definitely pick up a copy. In this book he states that companies don’t become great because they settle for good. At this point in the process, I’d argue the opposite. If you are currently in the planning phase, great is the enemy of good. When you are planning your business it is very easy to get stuck in planning mode, aka daydreaming, especially if you are a visionary type of a person. Resist the temptation to attempt to achieve perfection. We are here to get a good foundation to implement off of.

Good is the enemy of great. And that is one of the key reasons why we have so little that becomes great. We don't have great schools, principally because we have good schools. We don't have great government, principally because we have good government. Few people attain great lives, in large part because it is just so easy to settle for a good life.
Jim collins
Jim Collins
Author of the mega-bestseller “Good to Great”
Jim Collins on

So, how do we not get stuck staying busy planning when we don’t know what we don’t know. How do you know how many sales you need each month to replace your current income when you don’t know yet what you can sell your services for? Some people would call this back of the napkin math. In physics or engineering this is called a Fermi Problem, named after the physicist Enrico Fermi. It allows you to solve an unknown with a series of estimates. A classic Fermi problem is “How many piano tuners are there in Chicago?”, or “How long would it take you to clean all the windows in Seattle”. We can apply this same rough estimation to find out how many sales calls you’d have to make to generate $100,000 in revenue. For example lets take your Outdoor Survival Product Marketing business:

how many sales calls you’d have to make to generate $100,000 in revenue?

Average Project = ($100/hr service) x (40 hours average project), $4,000 per project

Number of Projects Needed = $100,000 / $4,000 (average project), 25 projects needed

For every 5 calls = 1 meeting, for every 3 meetings = 1 proposal, for every 4 proposals = 1 booked project

(5 calls) x (3 meetings) x (4 proposals) = 60 phone calls for one booked project

If you need 25 projects to get to $100,000 in revenue, and 60 phone calls for one booked project, you’d need to make 1,500 phone calls to hit your goal.

1,500 calls per year to hit our goal, that sure sounds like a lot. But if you plan to work 20 days per month, that is averaging just over 6 calls per day. Is that doable?

Now I couldn’t tell you if $100/hr is competitive for Outdoor Survival Product Marketing, or if the average project size is $2,000 versus $5,000. But here’s the magic to what we just did, it took almost no time to calculate and now we have something to validate against as we begin to learn about those market variables. This is also why it is extremely valuable to be as targeted as you can with what services your business will offer.

Jason Cohen in his blog article “Fermi estimation for startup business models” illustrates that the accuracy of the estimation at this point is, at best, a power of ten. One great point that his article brings to light that if in the above example we don’t need 5 calls to book a meeting, but 50, we then need to make 15,000 calls in a year to hit our goal. Is that feasible? Well if that is all you are doing you could probably make 60 calls per day, but who will get the work done?

Early in a company’s life, you don’t know anything. Often your best estimate of any metric or market behavior or business model component is at best accurate within a power of ten.
Jason cohen
Jason Cohen
Founder of WP Engine and Smart Bear Software asmartbear

If we are being truthful that we may be off by a power of 10, make sure to set realistic, obtainable goals for your development as a business owner and for the growth of your enterprise. Take your long-term vision, put it down on paper—but work backwards and break it down into manageable achievements for this year and the upcoming months. This will allow you to realize unrealistic goals before they go unmet and maintain some confidence. Making the 6 calls per day sounds easy enough, but do you know who those 6 people are? How about tomorrow’s 6 people? Ok, not trying to scare you, but we’ll get to all of this of how to target and quantify those customers later on in the book.

Don’t lose momentum if success is slow. It’s better to celebrate modest gains over time than to wait for a huge leap in sales. Remember, “Slow and steady wins the race.” A slow build is also your best bet for consistent growth. As we talked in chapter 2 about blocking off maker vs manager time, you may find that Monday is your best day for sales calls and you should schedule them all on Mondays. Don’t worry you’ll figure out a rhythm to all of this. At this point we’re just making assumptions.

It’s most important to prepare for the expected achievements or the expected amount of work ahead of time. Many new business owners will adjust their end goals so they have a better chance of obtaining them.

If you can find a rhythm and process to get to $100,000 in annual sales, who says you can’t amplify that later on to get to $200k, $500k, or even a million in annual sales with the right resources. As we’ll find out later, bigger revenues appear better, but come with their own logistical issues. You may find out that you want to run a great lifestyle business that allows you to spend more time with your family and staying a small agency.

As you work towards good goals, remember that good often leads to great. This is worth the wait and effort.

Action Items:
  1. Figure out what effort (meetings, proposals, sales calls, etc) it would take for you to generate revenues of twice your target annual income. Is it something that could be done with the skill sets and time that you have?
  2. List 3 questions you can answer in the next week that validate what you don't currently know about your business idea?