Bringing in enough money week-to-week to eat, pay the bills, and maybe have some fun can seem daunting. Whether you’ve had experience with making a good amount of money in your life or you’ve never had more than has barely gotten you by, somehow when you’re self-employed it seems even harder or more elusive.
I and others teach many angles on healing money fears, or understanding how a business works. That’s not what I want to talk about here.
I want to talk about numbers. Not to freak you out. My intention is to show you, through the numbers, that there is plenty of money out there. There is, even if it has not been distributed in a particularly equitable fashion. Justice and fairness seem to have been exiled from our economic system for centuries now.
Nevertheless the money is there. It is. It’s available for your business without having to rob a bank.
I’m going to use U.S. figures, because that’s where I live and that’s what I understand. Although I learned enough French to dream in that language, I’ve always hesitated when trying to think mathematically in any language but English.
If you’re not from the United States, please forgive me. You may have to do a little translation. The concepts do still apply in the industrialized world. Obviously developing nations have a far different situation going on.
Let’s start, shall we?
How Many People Are Within A Mile of You?
In my Portland urban neighborhood made up of individual family homes with yards, a square mile equals about 20 blocks by 20 blocks. On my block there are fourteen homes. If we make the assumption that there is a single family per home, that means there are approximately 5,600 families in a square miles around me. While it’s true that there are a good number of blocks taken up by parks, it’s also true that there are apartments and some denser housing, so I’m thinking it all evens out more or less.
The average family income in Portland is $55,000 per year. That means that in the square mile around me, $308,000,000 is earned each year. Yes, three hundred and eight million dollars.
And that’s only the square mile of homes around me. If I include homes within a three mile radius, then you have to multiply that number by nine, which brings it to $2,772,000,000. Two billion, seven hundred seventy-two million buckeroos.
If you can reach people via the internet, and you’re not dependent on physical location to serve clients, then obviously you get to multiply that number by many, many more miles.
While it’s true that many of those dollars are not what you might call “disposable income,” you still have to admit that that’s a lot of cash.
Five Million in Revenue From How Many?
If you’re someone who obsesses over how many followers or subscribers or readers you have, here’s another calculation for you. My parents ran a retail business until recently, and the only form of marketing they did was through my father’s blog and email list.
This retail store supported the families of more than a dozen employees. The annual revenues were about $5 million.
Their email list? 100,000 people? Nope. 20,000? Nuh-uh. 10,000? Getting warmer.
He had about 7,000 subscribers on his email list, which brought in five million in revenue. And many of those subscribers didn’t even live in the area, and so weren’t actually customers. While the store had a lot of word-of-mouth and geographical visibility that contributed to the daily customer count, my father estimated that the email marketing to those 7,000 subscribers was directly responsible for at least $2 million of that, maybe more.
What Does Fifty-Five Thousand a Year Look Like?
If you are going to earn the average income for Portland, Oregon, that means fifty-five thousand dollars a year. How might that much money be generated by an entrepreneur like yourself?
Fifty-five people paying $1,000 over the course of a year. This could be $150 per month for eight months, or $250 per month for four months. Or…
One hundred ten people paying $500 over the course of a year. This could be a $50 product, then a $125 product. Later in the year $125 over three months for a class, or a course of treatment. Or…
Twelve people paying $3,000 over the course of a year for a year-long intensive, or regular intense client services at $250 per month. Plus another 50 people who do four of something at $95 each time. Or…
Fifty-five hundred people spending $10 each. Or…
Some other combination of your choosing.
The point isn’t the combination you choose. The point is… what is the point?
The Numbers You Need and Want Are Actually Pretty Small
It’s easy to get worried about how much money you need. And that thinking can become a blinder for how to move forward.
The kind of blinder that insidiously supports thoughts like, “I better focus on reaching rich people, because that’s where the money is.” Or “I need to scrape along, because there’s so little to be had.”
I’m not one of those big abundance people who likes to whip you with the idea that abundance is everywhere, that you can have what you want. It’s not particularly true, and there are lots of limitations to physical resources.
However, if you’re trying to make a living doing what you love, I do want you to internalize this point: there’s a lot of cash out there. A LOT.
And the amount you need, relative to all of that, is pretty small actually.
If you’re struggling to get your hands on some of it, not because you’re greedy or want to take a bath in caviar (ewww… yuck!), but simply because you want to make a living, there are three simple questions you need to answer in your business.
La Premiere Question: Who are you serving? And what problem, in their own words, are you helping to solve for them?
This is the most basic question, and for more info, check out this article: “Why We Talk About Problems… and What Comes First”
Second Question: How do you communicate with those people so they’ll hear and respond to what you are saying?
This is a big struggle for many people, and it’s often simply because it’s easier to grab hold of an irrelevant factor like messing with your pricing, or some other detail.
Instead, you’ll learn tons by focusing on learning how to communicate effectively with others. That includes learning about marketing and studying how to build healthy relationships.
It’s not about manipulating anyone, it’s about learning how to speak their language so they can understand whether or not you are calling their name, providing the solution they need to address the problem they’re facing..
Question Numero Tres: What offers can you make that they want?
Because you are good at what you do, you can probably come up with an offer that your people need. The trick is to deliver the medicine with a spoonful of sugar. So, how do you craft an offer that gives them the medicine they need while providing them with what they are wanting?
Advanced tip: create a suite of offers at different price and commitment levels to reach the different people in your audience.
It’s All A Little Oversimplified
I know that each of those three questions requires real brain-smacking, heart-twisting, consciousness-expanding processes. It may not be rocket science, but it’s not one-two-three easy, either.
Each question takes some learning, some guesswork, some meditation, and some trial-and-error. But when you uncover answers to these questions that work, you can start connecting with people, enjoying yourself, and earning a living.
If you are genuinely in service to others and can really help people with something they are struggling with, you can make a living doing it. Give yourself the spaciousness to answer these three questions and when people start to respond to your offers, paying you real money for them, you’ll realize how small the number of clients really is that you need to make a comfortable living.
19 Responses
I love this. I love that it is oversimplified because it puts a completely different perspective on money. It reminds me that there are plenty of people out there who want what I can offer and plenty of people willing to pay for it.
I’m currently starting a new project and I’ve been worrying about who will pay for it and how I can make money from it. Having read this blog post, I feel I can let go of that and trust that the money will be sourced when the time is right. That feels so liberating and means I can focus my energy on something constructive.
.-= Jude’s lastest post: Finding clarity in the chaos =-.
OMG, every single client of mine has to face these questions, because without them they’re nothing to nobody, and their business will never get anywhere. It is counter-intuitive to focus and narrow, but it’s like pinching a hose: the water shoots out with greater force.
I’m SO glad you’re doing this, too.
Also, here’s a fun question: is there any less money in the world? Are there, in fact, fewer dollars in existence? Of course the answer is “No, there is the same amount (or more) of money in the world now as there was last year or earlier.”
It’s all a matter of how to move it. It’s got to go somewhere. Your bank account is as good a place as any. 🙂
.-= Michael Martine’s lastest post: Ten Steps to Rock Your Business Blog in 2010 =-.
That sounds great. Then I think about how much of that $55,000 is actually profit and how much is tax… It’s daunting, to be honest.
.-= Trisha Cupra’s lastest post: Can Mr Magoo read the text on your Website? =-.
Someone once shared with me the image of all that money circulating and flowing and how we each can choose to tap our individual pipe into that general flow.
That has helped me have a healthier relationship with money – it’s there already, I just get to tap in and channel it, often by investing in great services for myself.
And I love the simplification you offer, Mark – just what I’m needing at the moment. In fact, I’ve put a message out on my networks, asking what people would say the #1 problem I help solve for them is. Looking forward to reading the responses…
Thanks, as ever, Mark.
Corrina
.-= Corrina Gordon-Barnes’s lastest post: It
As Michael says, this is one of the things that I teach and coach quite a bit and you put it across so well here 🙂
Fantastic stuff, as always Mark – you rock 🙂
.-= Chris Garrett’s lastest post: Defeating Procrastination: Become a Finisher =-.
Some simple math…
if 3% of your new visitors opt in or respond…and 10% of those becomes a “lead” and you’re a Realtor…that closes 1 in 10 “leads”…this means that
Closings = Traffic(*.03)*10%. .003% of your traffic = closing.
1,000 hits = 3 closings.
A closing to a realtor on a 170k house = $5,100 Gross Commission Income.
A blog post then, properly done for the area should generate 50 hits over a 12 month period. Every area is in play.
50 = 5% of $5100.
Oversimplifying, but that Realtor has made $255 on a blog post.
In my first “real” job (full-time, suit-wearing, benefits-getting) my boss talked about this sort of stuff. We had a retail store that was part of a big chain, and it was pretty specialized. We sold a high-end product, and lots of people who came in just looked and talked — but didn’t buy.
His theory was that if we did a good job of treating those people well, even if they didn’t hand us money, eventually some of those dollars would end up in our register. They’d refer a friend, or they’d get a gift of cash for a birthday, or a big bonus on their job — and that we really didn’t need to get every customer who wandered by to be successful.
He also introduced me to the theory that if you just shear the sheep a bit each time they come by, it’s not as shocking to their system and they come back again and again. Kind of like your model of structured offers at different levels. I often see someone who wants my first engagement with them to be $2500 and am a little amused.
For that much, you’d have to be some kind of Spiritual Master who could lead me to Bliss. Or at least show me how to balance a Duck on my shoulder while standing on one leg.
.-= Dick Carlson’s lastest post: Is SEO DOA? Maybe Content Matters! =-.
Love that last line Dick, leading you to bliss for 2500. You are so right about the soft entry approach!
This is an awesome post and you put across your point so clearly.
These three questions distil what’s really important. I’m in the middle of thinking out how I’m going to make money from my blog this year and am going to take your questions and really think them out.
Also, I love that you’ve taken the normally magical/mystical abundance stuff and made it concrete. I do believe that the world is an abundant place, but I also think we need to engage our energies appropriately to profit from it. Your article helps me understand “how to”.
Thanks so much.
Well here’s one of life’s little ‘co-incidences’, in the middle of a day when I have been feeling really rather overwhelmed, at least in part by exactly what this article deals with, I find this. I find it, moreover, by complete chance because I happen to fire up Twitter for 2 minutes between tasks and someone’s link floats by (thanks Naomi) – I’ve never heard of this site before.
So thanks – you just threw me a life-preserver at a very useful time. Well, the situation wasn’t life-threatening but you know what I mean: something to hold onto. A bit of perspective I needed to hear. It’s much appreciated…
i am one of the “abundance is everywhere” people 😉
and i love looking at it this way. abundance is about much more than money but money is important too and there is so much flowing around everywhere, even a small net can capture enough for a healthy income.
looking at your questions at the end is like making sure your net doesn’t have any holes in it.
.-= ABCcreativity’s lastest post: changing focus (or: creative journaling vs art journaling) =-.
@Jude- I’m so pleased the oversimp was helpful. Yes- money is a by-product. Important to pay attention to it, but no need to obsess.
@Michael- Yah- those are the magic three questions. Basic, basic, and you can’t slip past’em.
And yes, gotta go somewhere. That’s what I’m sayin’. I’m hoping that people who have love in their hearts and something powerful and healing to contribute to the world can plug into that flow, siphoning it off from the Evil Forces of Doom and Greed.
@Trisha- Well, yeah, sure, but think that “profit” is after all the bills are paid, including roof, food, and etc.
And heck, if you need another $10K or $20K on that, just add a few more blocks of houses to your calculations.
@Corrina- A perhaps unintended version of “Drill, baby, drill.” I can’t believe I just wrote that. Now it will come up searches and I’ll end up with a bunch of U.S.-based tea-bagger crazies subscribing to this blog. Not that they don’t deserve love, but, well, y’know.
Anyway, here’s to simplification! And I’m so interested to hear what problem they think you solve.
@Chris- I’m so glad you teach it, too. I may rock, but remember, “It’s all done with mirrors.”
@Genuine Chris- Simple math is the best. And the math is so helpful. Especially if we don’t forget that each of those numbers is also a live human being with a beating heart and the hope of love and connection in their dreams.
And, $255 is better than a poke in the eye with a sharp stick.
@Dick Carlson- I always knew you were just looking for Bliss, you under-cover hippy.
And yes, I love your old retail hippy high-end extravagant teacher’s ways. Right there. That’s what I’m sayin’.
@Christine- If it came across clearly, let’s give a big round of applause to Kate Williams, whose infamous red pen is such a big help in these things. 🙂
Yeah, I’m a big spiritual woo-woo guy, and yet I’m not so into the whole magical-thinking, “law” of attraction stuff. The concrete is sacred, too.
@Tobias- There is no chance. I paid Naomi good money, at least two blocks of houses worth, for that tweet. 🙂
Glad it was a life-preserver for you. You don’t mind if we share it, do you? I think we both can float here comfortably for awhile.
@ABCcreativity- I am so into patching the net, and not just hoping the fish stick around.
Love it, my friend. And even if we add taxes and overhead, the point remains. The numbers are within reach. And our creative choices will be much more effective if we remember that.
.-= Molly Gordon’s lastest post: How to stop doing it all without losing control of your business or your budget =-.
So often we hear about followers, subscribers, or readers. As you pointed out we don’t need need an email list of 100,000 people to make a living. We need True Fans. That’s why answering your three questions are so important, because it helps businesses connect with their True Fans needs. Hence the relationship is born and can continue to grow.
I also teach and coach about the “blinder” and how limits their possibilities. Thanks Mark for providing concrete and clear information!
Just yesterday, I was discussing income goals with a friend and I started really low ($15-25k) because 1) I don’t need a lot of money and 2) anything above that seemed out of my league. But we talked a bit more and I adjusted my goal to $60k although I have no real plan on how to get there.
THIS post has already helped me to see it as a reasonable goal and with those questions I can plot out the how.
Thank you for the timely, meaningful information, as always. 🙂
Great post – you’re speaking my language! It’s so easy to get overwhelmed by big numbers. When you break it down in to manageable segments it’s easy to see how fast it all adds up. Reminds me of something I like to say…Never die of thirst while standing knee deep in water!
.-= Alicia Hicks’s lastest post: If you register your site for free at =-.
Ah, that’s a much less daunting way to think about. Thanks for putting it into perspective for me. 🙂
@Molly- thank you for that- you are such a light in this particular arena yourself.
@Koren- You’re so welcome- and glad you’re teaching it, too. 1,000,000 of us teaching marketing and business, and we’re all saying the same thing. Thank goodness.
@Amy- glad it helped! And, I’m a big believer in starting where it feels real. SO if 25K feels real, go for that. Because once you get close, the $60K will then feel real.
No need to go for goals that make you feel like you’ve swallowed a watermelon. Just not healthy, and oy, the indigestion.
@Alicia- Break it down! And yes, kneel down to drink. Sometimes it’s the humility that gets us there, not the bigness. Not that you were saying that. I just kinda go there sometimes.
Trisha- Glad that helped!
Wow did I find your article at just the right time. I am struggling with making my online business my full time business and your words hit me head-on. Thank you so much.