Here’s what an average day for someone running multiple businesses often looks like. They wake at the crack of dawn, check emails, check sales from last night, check inventory levels, check in on orders going out that day, check back on orders being processed that day, make a cup of coffee, send a tweet, check emails again, field phone calls from their wholesaler, return phone calls from customers, check email and finally get to take a swig of coffee. And that’s just before 9 a.m.
As nuts as this may sound, it isn’t far from the truth for many entrepreneurs juggling several eCommerce businesses. Multiple business owners and podcast hosts Andrew Youderian and Bill D’Alessandro discuss how to manage your expectations when you’re running two or more businesses, why so many entrepreneurs take this difficult path and tips for making it work if you do.
Splitting Your Time Between Two Businesses
There’s plenty of conflicting viewpoints about running multiple businesses. One school of thought believes it’s completely doable as long as you’re prepared for the amount of work ahead. On the flip side, some would say it’s virtually impossible to make another business successful until your original venture can practically run itself.
Either way, owning and operating a single business requires lots of juggling. When you add another venture into the mix, you’re not doubling your workload, you’re probably tripling it. Running two businesses does not mean each one will require an even split of time and energy.
Essayist Paul Graham is a venture capitalist that broached the topic of dividing your time in an essay called “The Top Idea in Your Mind”. His hypothesis is that the human brain can only handle one big long-term idea at a time, the “top idea”.
He writes: “I realized recently that what one thinks about in the shower in the morning is more important than I’d thought. I knew it was a good time to have ideas. Now I’d go further: now I’d say it’s hard to do a really good job on anything you don’t think about in the shower.”
Even those that are seasoned at running two or more businesses will eventually hear their subconscious tell them that it’s time to cut down and stop doing so much. It is far easier to build momentum when you put all your energy into one idea.
If you are already in charge of running multiple businesses, you know firsthand that the highest cost you’ll pay will be in mental task switching. Microsoft did a study about interruptions in the workday and found that 40-50% of people never went back to the task they were working on when they were interrupted. In fact, you probably won’t even get to the end of this blog post without checking out a YouTube video, looking at an email or making yourself a sandwich.
Don’t Start Business #2 Before You Can Live Off Business #1
This is the ultimate entrepreneurs dilemma. You’ve got your first business off the ground and it’s going well. It’s not in a place where it can run itself, but you’ve got another business idea that is keeping you up at night. So why not just start it?
“The business you haven’t started yet that you just know will be wildly successful is always more attractive than the one you’re working on right now,” says Andrew. “But it’s almost always a bad idea to pull the trigger on starting it.”
It’s a challenge to make one single business successful. It’s even more challenging to try and keep one going while you ramp up an additional one. As tempting as starting a new business may be, you need to build systematically if you want them all to succeed.
Systemize Your First Business
Once you can live off your first business and have automated systems in place, then and only then should you prepare yourself for another venture.
The business you haven’t started yet that you just know will be wildly successful is always more attractive than the one you’re working on right now.”
Getting good systems in place is key when you are doubling your workload. First there’s the everyday tasks to keep the business at status quo, which should be relatively easy to systemize. But moving forward, you’re the sole person responsible for taking the business to the next level. If you’ve got two eCommerce sites up and running, you need to be able to process all those orders in one place. Automation, VAs or finely tuned standard operating procedures will help keep orders going out and money coming in.
As the owner, this step is necessary so you’re able to knock things off your growing to do list. Take a look at some of the legendary entrepreneurs like Jack Dorsey and Elon Musk. The way they grew their businesses was to hire key employees and managers that could handle strategic growth opportunities. And as Elon Musk will undoubtedly attest to, the most qualified candidates that can really help you grow your business in the right directions will also be the more expensive ones. This can be problematic for business owners that don’t have the capital to hire top-notch employees.
For more details on how to systemize your business and team with SOPs, see our post on managing a virtual team across 5 time zones.
Focus Your Attention On One Business At A Time
If you’re in the position to focus on more than one business, try to direct your efforts on one thing at a time.
“Focus on one business for an extended period to get the best efficiency results,” says Andrew who recently prioritized the past six months on migrating his store from Shopify to Magento and is now spending the next six months on improving the eCommerceFuel private forums.
Your most productive days will be when you can devote yourself entirely to one business, rather than wasting an entire morning playing whack-a-mole with emails. If you can emerge yourself in one venture for a full day, week or month at a time, you’ll have better efficiency results than trying to jump back and forth between businesses.
“Focus on one business for an extended period to get the best efficiency results,” says Andrew.
Easier said than done. “For me it’s the classic entrepreneurial ADD that’s the hard part,” says Andrew. “And seeing something that you want to be doing that has potential.”
Businesses can take awhile to mature and grow up, which can also cause a bit of unrest on the part of the entrepreneur. But if you can wait it out and let one business mature first, adding another enterprise to the notch on your entrepreneur belt will be more worthwhile.
When You’re Ready to Start Venture #2
There are two solid cases that are worth pursuing if you think you’re ready to add another business to your plate, even if your first business isn’t in an optimal self-sustainable state.
Plant The Seed
Some business ventures by nature will take more time to get off the ground than others. If you’re starting a new eCommerce business in a niche that will require some time to scale up in name recognition or building market share, it might be worthwhile to just go for it.
One thing to consider is the fact that you’ll be allotting tons of your time and energy into a business that isn’t getting any revenue. “It’s going to be an attention split with your current business even though your current business is generating 99% of the revenue,” says Bill.
Keep the lack of financial rewards in mind as you put out tons of energy into a project without a ton of rewards.
Use Your Expertise
There are some great opportunities for adding another business to your plate if you’ve already got proven expertise in a field or niche.
Starting a second business may make sense if many of your existing customers will carry over. For example, if you sell high-end face oils and your customer is going elsewhere to buy their hair products, it’s an excellent opportunity to leverage your knowledge about the niche and use your existing customer base.
“This might go faster compared to someone with a cold start, but that doesn’t mean it will justify the amount of time it’ll take me away from my revenue-producing business, “ says Bill.
Just make sure you know you have a real, unfair advantage so you can ramp your additional business quickly.
Outgrowing Your Market
There are certain situations where your business might just max out.
Let’s say you’re the top seller for high-end avocado peelers where you’re number one in Google and you’ve got the business to where you only need to give it 5 hours of your time a month. This is a great time to go into something else where you’ll have more up room to grow.
“In that case, sell avocado mashers or guacamole bowls instead of kitchen knives,” says Bill.
Again, here you’ll want to utilize your current customer base to optimize your next venture where there’s much less incremental work involved than compared to starting from scratch.
When To Say “I’ll Pass”
On rare occasions, you may see a screaming business deal or an opportunity that appears “too good to turn down”. But if you’re still working on getting business #1 up to speed, should you take the plunge?
“This is the hardest thing for any entrepreneur. You have to learn to deny yourself. It’s not saying no to someone else – it’s saying no to yourself,” says Bill.
As much as you’ll try and rationalize the decision and talk yourself into it, here what will likely be the outcome: neither business getting the attention it deserves.
The bottom line is that once the eCommerce business bug has bit, it’s hard to take it slow and steady focusing on just one venture – especially once the ideas keep on coming. But if you focus your energy on building one business at a time that can practically run itself, you’re well on your way to being a successful multi-business guru.
Have Bill and Andrew scared you out of being a single owner running multiple businesses? Or convinced you to do it? Let us know in the comments below or by chatting with Andrew and Bill directly in our private forum.