In 2011, during my final year at university, I was constantly calculating my options. I was confused about what career am I going to pursue after I graduate. I was graduating with a Computer Science degree, but was also running some profitable online ventures before my graduation.
In hindsight, this was an overly simple decision. I should have simply went ahead with my online ventures. And of course I did. But back then, it was confusing because I was much younger, I was constantly getting wrong advice from all the places, my teachers were telling me to get a job, and my mother had mixed feelings. This happens to pretty much all the Pakistanis and the reason why I’m writing this is because it’s going to happen to many other students when they are faced with similar circumstances.
During this I received a very unconventional advice, that came from an unexpected place. I say that because it was given by one of my teachers, Sir Waqar, and it was very untraditional. I also think it was unexpected and untraditional because it was completely different from what other teachers said. I also liked it more because it was not a generalized advice.
What he said was something like this. He said if you’re able to save Rs 50,000 every month with your job, and you keep doing that month over month for 30 years, you’re going to save in the entirety of your career a total of Rs 18,000,000. This is Rs 1.8 crore or Rs 18 million or on today’s exchange rate $116,000. This figure was $216,000 when he first gave me this advice. It has come down to $116,000 in 8 years due to exchange rate. In another 10 years, it may be $70,000. He added, if you like this number for your retirement and can save Rs 50,000 every month from salary, go ahead and get a job and if not then do what you love to do.
I love it how he kept it real simple. He didn’t add jargons like inflation and other things, because clearly no one at that age has the ability to understand finance like that. He did not give me an absolute advice where I was told what to do. He just explained my options to me with a simple numerical figure.
I’ve kept this advice close to my heart for over 8 years. I have shared it with every student I meet who asks me this question and I hope others find value in it the way I did.
I’ve been rejected so many times in my life. For a very long time I actually thought that I’m gonna have to struggle with food as soon as my parents stop paying my bills. I thought that because I was constantly getting rejected.
After finishing my high school (FSc in my case), I was rejected twice from joining the military in Pakistan. I’m not even sure today why I applied, and glad that it didn’t work out. I appeared on the NUST Business School merit list, but later turned down by them after the interview. They decided I didn’t deserve to study business in their prestigious school after meeting me in person. My provisional admissions in some other universities were also cancelled after the 2nd year (12th grade) results came in. My parents had even paid the admission fee. Pakistani kids can imagine that I was in real deep shit.
I joined the first university I could after that. I think spending 4 years there was a good experience. It helped me become who I am today. Bahria produced a ton of entrepreneurs from my peers. I got to know many people who are today massively popular musicians, movie stars, film-makers, photographers, bloggers, product creators etc.
If you’re in the digital space chances are you already know about Saad Hamid. Taimur Asad came out to be one of the most popular tech bloggers, not just in Pakistan but pretty much in the world. Ghaus Nakodari, the kick-ass founder of Jumpshare. Adnan Shafi, who recently raised $450,000 for his startup PriceOye. These are just the people I was friends with at college. There could actually be countless more.
I don’t think Bahria was doing anything special with education. I just think they weren’t punishing students hard enough, like other top Pakistani educational institutes. And I think that let the natural talent come out of all these people. Which is everything that matters in the end. So if you’re struggling with university right now, don’t sweat about it, everything can and will work out.
Anyway, back to rejections again. It took me 6 years to make a profit at Koolmuzone. And in the end I had to close that profitable business for very external circumstances. I’ll write about it someday.
When I finally got a break, I was turned down by the most prestigious accelerator in US. Some rejections taught me great lessons about myself and I got great value from them (accelerator rejection). Other rejections helped me learn about the sad state of affairs of so many institutions (Pakistan’s education system in general). And some rejections helped me realize how misfit I was and they were nature’s way of putting me away from the course not intended for me (military).
But none of them let me down, or stopped me from my ultimate destiny. Rejections will either add value in your life, or will be net-neutral, but in the bigger scheme of things, I don’t see rejections ever taking away value from your life. You have to keep trying and never give up. And this is mainly for younger folks, stop sweating about rejections. It all works out in the end. Not just for me, but for everyone. Everyone is someone in the end.
It all started with friends complaining that you couldn’t get a decent biryani in Islamabad. While Socialoholic focuses on launching digital businesses as soon as possible with minimum viable product, I would see my friends planning features on top of features for a biryani delivery service which did not exist yet. And the discussion would always end with one big question.
Will it work? Is there enough market for this biryani delivery service we are planning to open? Are we going to lose all the money we are going to invest?
Sick of this continuous discussion with no end in sight, I wondered if an offline business can be launched like a digital MVP startup. I downloaded a beautiful biryani creative from Google Images, created a facebook page with a logo I designed in 2 minutes and ran a Facebook ad with $5 budget.
To ensure that people were actually going to order biryani instead of just liking and commenting on a beautiful biryani photo, I added a phone number in the Facebook ad and hoped to see the phone ring. Lo and behold, in about 10 minutes of my ad getting approved, the phone started ringing and everyone wanted to order the biryani which did not exist in real world. Being a growth hacker, I just told everyone that biryani is sold out which further hyped the biryani startup.
Keep in mind that there is no biryani to sell yet. We are just running a Facebook ad for a biryani restaurant while sitting in my bedroom.
Once we had the calls, everyone was confident that Biryani Express is going to work and Fasih, the CEO of Biryani Express got to work. But our focus still was that we have to test this with minimum possible investment.
Instead of hiring chefs, Fasih ordered biryani in bulk quantity and sold it on per serving pricing and hence pocketing the difference in revenue vs expenses. In earlier days, we were even doing deliveries ourselves just to prove that my thesis of running a small business with no money is true.
Once we had proven the idea, Fasih, started hiring chefs and created the logistics infrastructure for Biryani Express and today it is one of the most famous biryani delivery service in Islamabad.
What started with a $5 ad on Facebook is now a great small business which employees 8 people and has generated $38,000 against a life-time Facebook ad spend of $1,729.
This just shows that the concept of lean startup and MVP is as applicable in offline world as it is in digital world.
P.S I have anonymized the actual name of Biryani Express as my friend didn’t feel comfortable sharing revenue numbers with actual restaurant name.
About the writer:Saad is co-founder and CEO of Socialoholic. He can be reached on twitter.
I see a lot of people waste tens of thousands of dollars trying to setup their businesses. In the end, I often hear that it didn’t work out as intended. I understand that. I more than appreciate their efforts. Failures happen whether you like them or not and I’ve failed plenty of times myself. But I’ve a fundamental problem with those who don’t do some pre-launch research.
Some just don’t know that its a thing; pre-launch market research. And others, just don’t know the right or cheap way to do it. As co-founder of multiple start ups, I have tried and tested hundreds of different business ideas and as a company, we have developed a very solid strategy for testing them before launch. I’m going to write about the easy and cheap part from our strategy below.
Often this strategy costs us $20 or less. Sometimes as little as $5 depending on the target market. And this strategy works for both online and offline businesses. Some of you might hate me for making you wait, because it’s pretty simple but I guarantee you it works. Even if you’re setting up a huge business, this will help.
Run an ad. Yes. Whether you want to sell a product or a service, run a Facebook ad before you create the product. Before you invest in your brand. Set up a dummy page. Call it a name using this tool. Create a free logo; head over to this tool, click click click, and you have your logo. Decide your target market. You can target different age groups, interests etc and spend $5 per ad-set, or more if you need more data or if your target market lives where ads are expensive.
In a day or two, you’ll have some sort of sales, leads, or whatever was your end-goal. Apologize to your customers because you’re out of stock and delete your dummy business. If it works, awesome. If not, either you don’t know your target market well enough, or your business product or service is not needed as you expected. Make changes, try again.
Let me know your thoughts if you think it’s a good idea, or if you think it’s just stupid! We’ve had great success using it. In fact, my co-founder built a large offline business using this strategy in addition to all the online businesses that we build, and I’m pursuing him to write about his experience. I think he’ll just do that very soon. It’s a very exciting story.
This blog post isn’t about Fiverr in general. It’s about freelancing, which I think is a great place to kick-start your internet journey from. I mentioned Fiverr over other platforms because it starts as low as $5 and that’s a great point to start from. But I’ll get back to this later.
Back Story
As already mentioned many times over, I started in 2002 with a homepage, a music site and a web-forum. Given that I didn’t have $50 as a teen to buy a domain or a hosting, it was difficult to get started. Many other young Pakistanis and people from other emerging countries face the same problem even today; investment. They don’t have money as little as $50 to start their internet business. Which is why I love Fiverr. As a kid, I didn’t know you could earn a living on the internet by providing services. I only knew about the display ads and running a website needed investment. That has changed drastically over the past many years.
Why I Love It
You can basically get started today if you know anything at all. If you know a certain language, you can translate. If you are a fluent speaker, you can provide voice-over services. If you can click, I think you’ll find a job for that too. For clicking thousands of times everyday. And I love all of this because it is the simplest way to get started. It requires no money, little skill, and you can start selling. This is why I love Fiverr.
I also love Fiverr because selling services is not just about having a skill. It’s also about marketing, sales, customer service and more. And running a gig prepares you for all of that. You learn everything about selling end to end. Along the way you can make some mistakes, and it’s all going to be fine. Your customer only pays very little and expects a few mistakes. He’s gonna be some-what patient with you. Fiverr teaches you a lot. I think the hardest part is making the first $100 online and Fiverr makes that easier. $1,000, $10,000 and beyond comes fairly easily compared to the first $100.
So if you don’t work online at the moment, go ahead and sign up at Fiverr straight away. But if you’re already working as a freelancer, keep reading.
Why I Hate It
As mentioned already, I think Fiverr is a nice starting point, but just that; a nice starting point. I believe in value creation over the long-term, passively or actively, but over the long-term. None of that happens on Fiverr, or any other freelancing platform unless of course you’re running an entire company or agency over the freelancing platform.
One of the greatest investors ever, Warren Buffett, says
If you don’t find a way to make money while you sleep, you will work until you die.
I believe in that. In making money while you sleep and it’s just not possible if you are only trading time against money. Time is limited and it is going to only make limited money for you and of course only while you’re awake and working.
Blogs, on the other hand, could provide long-term value. You could keep making money for many years even if you stop updating, or leave altogether. You could also sell it in the end for at least 20X your monthly profits. Software as a Service would also build long term value for you. Instead of providing your service individually and only once, you could be offering it to everyone again and again building not only nice monthly recurring revenue but a great value asset at the same time. Youtube channel, Instagram, Facebook Page; all of these can create long-term value. It doesn’t just have to be one of these things, but I highly encourage you to build a product or a user-base, no matter what kind.
Because I feel freelancing is great, but products are the shit!
This is the third part of the three-part series of posts that I planned to write on dropshipping. The first post explained what dropshipping is. Second part highlighted our scaling strategies, and the third part explains the final trick that boosted our sales by 837% as we handled over 10,000 orders everyday.
By mid 2017, we were successfully running 3 e-commerce stores. I was extremely busy running day to day ad-ops for our company. Fulfillment had been automated completely. But Saad, my co-founder, still had a few things outside of our core business ops that kept him very busy.
We were doing nearly 2000 sales a day, and posting growth month over month. I was happy with the progress but also very busy launching new ad-sets and optimizing existing ones. We were constantly trying to scale globally. We were extremely proud that we had a major portion of sales coming in from Brazil, Mexico, Portugal and Australia. Combined, this was bigger than US.
Meanwhile, Saad tried to crack an altogether different code. If you remember, I mentioned in my last post the #1 trick to scale a dropshipping business. I said I can’t stress enough it’s importance. That is exactly what Saad was busy with. He hired a team of developers in Ukraine and we ended up with what we internally call hypersonic. A product spy tool, only to be used by us that gained us leverage against every other dropshippper. We scrapped every single dropshipping store in the world, and found winners in real-time.
This helped us find 3 more winning products within 4 weeks, allowing us to eventually scale 8x. At the moment, we only privately use this tool because of the kind of leverage it provides us against others and haven’t decided to offer this as a service. However, I highly recommend serious 7 and 8 figure dropshippers to develop something like this internally to ace this game.
This is the second post of the three-part series that I’m publishing on dropshipping to help create awareness of what it is, and scaling strategies that we use in our company to rocket-fuel growth. This post is not for beginners and will make more sense if you have already started your dropshipping business or have some sort of digital marketing experience.
Since 2016, our company has been running several dropshipping stores in 3 different niches. Most of the growth comes from paid-advertising with majority budget spent on Facebook, Instagram and influencer marketing (also on FB & IG). We also spend about 20% of our ad budget on Pinterest and Google Ads. There is no reason why we spend less on the latter, we’re just more comfortable advertising on Facebook. It’s possible other dropshippers find more success on Google. So by all means I recommend that you explore it. Below I’ll list the top strategies we use in our company for growth.
#1 Product Hunting
I can’t stress enough the importance of product in your dropshipping business. Without a good product and creative, your chances of winning would seriously suffer no matter how good your ads are. I recommend that you spy other stores, AliExpress, Wish, Amazon and everything else that you can to get access to products before others. Most dropshippers use some kind of product spy tool which is often a paid subscription service. You can also search for products on social media platforms where they are being advertised.
#2 Influencer Marketing
Influencer marketing is often always an easier method to find success with dropshipping. To some people it looks more complicated because it involves reaching out to many people, testing their audience and sometimes losing money to less-engaging audience. You may also end up finding accounts with large amount of bot followers, causing total capital loss for the campaign.
The reason why I say it is the easier option is because once you make connection with the right influencers, this is basically an on-going, long-term money making opportunity. You can keep trying new products in the same niche with the same influencer and you can continue to get sales.
Influencer marketing is often also lesser competitive compared to the platform ads where everyone is competing, whether in a dropshipping business or not. This also means that once you have right influencers, you’re likely to have a much higher profit margin compared to running ads on any platform.
#3 Pixel Training & PPE Ads
Without pixels installed on your store from Facebook, Google (and any other platform you choose to advertise on), you’re never going to be able to run successful ads. In short, pixel is a small snippet of code provided by ad platforms that you can install on your stores. Once installed, the pixel establishes a connection between the store and the platform. For example, FB pixel will exchange data between the actions committed on your store and FB ad platform.
The pixel fires whenever a user initiates any action on your store whether it is view content, add to cart, initiate checkout or purchase etc. All user behavior and action data is stored in your pixel. As long as the pixel keeps getting fired, it continues to create an audience profile for you. The more sales you have, the more easily the pixel can help you find better audience. Without pixel training, your campaign is unlikely to do well for you.
First strategy that we commonly use to train pixel is running influencer marketing campaign to get quick, cheap sales. These sales help pixel understand our audience.
The second strategy that we use is running PPE (Page Post Engagement or simply Engagement ads). Engagement ads are cheaper than conversion ads. You get quick social proof, you get quicker, cheaper clicks and this can be a nice way to train and prepare your pixel for your actual campaign.
#4 Horizontal Scaling
After generating a few sales from influencer marketing and PPE ads, we start running website conversion ads. We create a large number of ad sets with a unique targeting angle for each ad set.We generally run these ad-sets on a small budget. This allows us to scale our campaign through many targeting angles. We also end up testing many targeting options. Setting a small budget for each ad set means you’re not trying to win all bids and so you don’t over-spend. Instead you scale horizontally, running many $20-$50 ad-sets. This way you can continue to lose bids (save money) as well as spend more budget (scale) your ad campaign.
#5 Vertical Scaling (with Manual Bids)
Once we have found our top winning ad-sets we also want to scale them vertically. What that means is we ideally want to increase budget for these ad sets. There are generally 2 methods of how this can be done.
Using the first method, you can increase budget for winning ad sets by 10-20% every 2-3 days. This is obviously a slow process and can sometimes not work as expected because ad-sets try to re-optimize every-time they are updated.
The second method is scaling through manual bids. This means that the budget can be exponentially and immediately increased. But we put a cap on what we’re willing to pay for each sale. If the ad-set fails to get a sale, it stops spending. We have had success running $5000/day ad-sets using this method. So this is a fool-proof method to scale vertically. You win, or you don’t spend.
#6 Lookalike Ads
Lookalike is a magical AI technology by Facebook which allows you to run ads without any targeting options. Once you have generated more than 100 sales from a single country, you are eligible to create lookalike audience. This is the quickest, dumbest, simplest way of scaling your ads by letting Facebook do your job.
#7 Retargeting
The simplest explanation of retargeting is not leaving money on the table. A lot of clicks to your website are going to result in missed sales, abandoned carts or simply window shopping. You can reach these high-intent buyers again. Just run retargeting ads, emails & SMS to convert these missed leads for almost negligible price.
Conclusion
A lot of this information is going to sound tough especially if you’re a first time advertiser. But who said running a 7-figure business was going to be easy. The good news is, you can simply start with influencer marketing and learn your way up. The better news is, this is a very low cost business to begin with. You can start with as little as $2000 and make your way up to 7-figure. And the best news is, we have seen it happen first-hand.
I was asked by one of the readers of this blog to write in detail about our dropshipping business. This is the first part of the three-part series of posts that I plan to write on dropshipping. Since this isn’t a how-to blog, I can’t get into too many specifics or step by step guides which there are many on the internet. A simple Google search will lead you to many tutorials. However, I’ll try my best to give you the birds-eye view of what dropshipping is, it’s several advantages, and the top strategies we use to scale this business.
Dropshipping is only a fulfillment method but has many advantages over standard fulfillment. In short, it’s a retail business where you keep no inventory. Instead, when you receive an order, you have your wholesaler or manufacturer ship directly to your customers. Today, over 20% of all e-commerce fulfillment happens via dropshipping making it a $700 billion industry. Below I’ll elaborate the several advantages of running an e-commerce business with dropshipping fulfillment.
No Inventory
Since a 3rd-party ships orders on your behalf, you never have to maintain inventory. This saves warehouse costs, dead-inventory risks, and you only buy what you’ve already sold.
No Stock Investment
This is a very obvious advantage of running a dropshipping business. Since you only buy what you’ve already sold, it means you never have to invest in inventory or stock. This saves serious capital as most businesses end up spending a large percentage of their entire investment only on product, leaving very little to nothing for marketing. As a marketer, I believe this is missing out on everything.
Unlimited Listings
The founder of the 2nd largest e-commerce store Jeff Bezos started Amazon by selling only books. Although Amazon is an “everything store” today, it was started with books for only 1 reason: the large number of titles available. He said
Books were great as the first best because books are incredibly unusual in one respect, that is that there are more items in the book category than there are items in any other category by far.
My takeaway from this is that he focused on listing large number of titles from single category. With Dropshipping you can do that, and more. You can list virtually unlimited items from any amount of categories you like. Essentially, you only need product photos.
Marketing Budget
Almost 90% of your total capital can go into marketing since you don’t have to invest in product giving you an opportunity to run your marketing campaign on steroids. As you get a sale, you can use that money to buy the product.
Business Structure & Taxes
Your business can be structured in a way where you may not be paying sales taxes on your orders, and the burden may also not be passed on to your customers. While in some cases, customers may have to pay customs duties as packages arrive from overseas, generally that will not happen on smaller cheaper products that are invoiced by wholesalers at the wholesale price. Please do your own research on taxes and structure as different rules will apply with different countries involved in the chain.
Disadvantages
As with any business strategy, there are obvious disadvantages too. The single biggest disadvantage of dropshipping is long-shipping times, as items often ship from different countries, and primarily from China. But this varies on case to case basis. Once dropshippers figure out their best-sellers, they start to keep inventory and stock at 3rd-party-logistics (3PL) in the destination country. The other disadvantage, also linked to the first one, is customer experience. The delayed shipping times can result in bad customer experience. However, experienced dropshippers can address this issue too using 3PL, providing real-time email / phone support, and by being up-front about their shipping times.
In the second part of the series, I’ll talk about the strategies we use to scale this super lucrative business.
Money is a really strange concept. A lot of people do not understand it very well. I’m actually willing to bet that there are more people in the world who don’t understand money than those who do. Unfortunately, they don’t teach you money in schools, certainly not the way I want to talk about it.
I often encourage everyone in the developing and emerging markets to work on the internet, reach a global market and earn a foreign exchange. I go on to the point where I believe and preach that it’s often even better for you to be positioned in an emerging market to unleash and hack the full power of money. Here’s what I mean.
It is ten times easier to live on $3000 in Pakistan, Indonesia, Thailand, Vietnam, Turkey, Bulgaria, and so on than it is in US, Canada, Australia etc. It all comes down to purchasing power in the end. With internet, for the first time in the history every individual has been given an opportunity to hack money in a way that you can absolutely earn an equivalent of what you can earn in US, without physically being in US. The equivalent might be equal in the number, but it’s even more valuable. Which brings me to my point, that money needs to be measured in the purchasing power terms.
Some of you might argue that the quality of life is not good in these emerging countries. I’m again willing to bet that there are dozens of countries with better quality of life than in US, that are 10 times cheaper, with lesser taxes, often complete tax waivers on exports and foreign exchange, and allow you to earn (online) an equivalent of what you’d make physically in US.
Great entrepreneurs not only work on yielding high gross revenues, but also on cutting expenses. For bootstrappers, reduction in expenses is the survival game. So use this opportunity to set up your company anywhere in the world with the right infrastructure and ecosystem while positioning yourself anywhere else in the world where you have the best and most affordable lifestyle and have a distributed team to run your business.
In the end it’s your choice whether you want to to live like a millionaire, or be a millionaire, or both. I’d go for both.
In 2013, I and Saad were invited to the bay area by a large seed accelerator. The business was doing great. We were posting not only insane revenues, but equally great profits. We were also posting decent growth month over month. In a way, we didn’t need the seed funding. But we did need the acceleration. And our goal was to get the right mentorship to grow our business beyond what we were doing already.
But we were rejected. They said no and we didn’t understand why. This is the email they sent us
I’m sorry to say we decided not to fund you guys. We were very impressed by your numbers so far. But what deterred us was that this is basically an arbitrage business. You don’t have users in the sense that e.g. Dropbox has, and thus no lock-in with them. Which means you make money for a while, perhaps a lot of money for a long while, but then conditions change and your revenues dry up.
Over the next few years, it started to make more sense to me. As the business did go down, the revenues actually did dry up, and I tried to see the things that they had said.
They were right and I was wrong and unless I acknowledge that, I can not be right in the future. I learnt a great deal from this experience. I understood the importance of having a lock-in with users as opposed to simply having users. With this knowledge, I can finally build businesses that will last longer.
