The Toilet Paper Entrepreneur by Mike Michalowicz

My notes on “The Toilet Paper Entrepreneur” by Mike Michalowicz

This book had excellent structure, but I’ve only made notes on the sections I found most interesting, so you might find these notes jump around a bit.

Launching Businesses

• I loved entrepreneurialism. I could talk about business all day, read every magazine, attend every seminar, and still my thirst would not be quenched. It took me a few years to figure out what was sitting right under my nose the entire time: That I loved launching businesses.
• Once I came to the realization that it is the birthing and maturing of a business that I love, I knew the path my future would follow.

Passion is the Starting Point

• What would you volunteer to do simply because of your love for it?
• What activities bring you the most happiness, energy and satisfaction?
• What makes you lose track of time, complete tasks almost effortlessly and come out even more energized?
• When you are talking with friends, what is the one subject you can just go on and on and on about, to the point they are rolling their eyes?
• Answer these questions and you’ve found your heart’s desire. And when you have found your insatiable thirst, your passion, you will have taken the most important step to launching a company that will excel.
• What if building your business made you feel emotionally satisfied, totally happy?
• What if your business made a difference?
• What if you woke up every morning excited to work?
• What if people loved your company?
• What if the world heralded what you did and happily consumed what you had to offer?
• There is no question about it. If you aren’t passionate about your vocation, you will have a real tough time sustaining a start up, let alone living through the dark days.
• And if you aren’t passionate about what you do, someone else who is passionate about it is going to kick your ass into next Sunday.
• Your long-term success requires a growing number of customers, consistent cash flow and your ability to outmanoeuvre the competition every step of the way.

Checklist Before Diving In

Before you dive in with your heart, first dive in with your head and make sure you can say a resounding YES to each one of these questions:

1. Can you make significant money doing this? Meaning, is it realistic that this business will bring in enough bacon for you to cover all your expenses AND stash A LOT away into savings?
2. Can you make money consistently? Meaning, is it realistic that this new venture will yield a regular, predictable, and growing flow of cash into the company?
3. Can it be started with little or no money?
4. Do you want to be an entrepreneur instead of a freelancer? If you want to be a freelancer, you are simply an employee without a boss. A freelancer focuses on mastering the craft, while an entrepreneur focuses on building the systems that support the craft.
5. Do you want to consume this product/service desperately, but can’t find it? If you do, you ARE the focus group.
6. Do you know people who aren’t friends and have the same interests as you? Do they also really want this product/service and they can’t find it either?
7. Is this business consistent with your values? For example, frugal types would be better off starting the next Old Navy rather than the next Polo.
8. Are people polarized on your concept? Meaning, do some people think it is a great idea and others think it stinks? Polarizing people is a major key to success because it brings about recognition from both sides. The side that hates you talks about it, and the side that loves you defends you. See how polarizing concepts get both sides talking about your business?
9. Is your business a one-shot, make-or-break deal, or can it be flexible and change as it grows. You may not get it perfectly right on the first go and may discover new things about yourself.

Three Exercises

1. What do you stand for? What standards do you uphold in your personal life? What do you expect from yourself and others in your life? In what aspects of your life do you waffle a bit? What are the areas where you will not move a muscle? Do you need to loosen up or have more conviction?
2. Immutable Laws are the backbone of your company. Building on your own values and ethics, what are the Immutable Laws of your company? How do these Immutable Laws benefit you, your staff, your investors, and your customers?
3. What’s your Why? Why are you an entrepreneur? Why did you choose your specific industry? Why, Why, Why? Keep asking until you get to the heart of the matter.

Feeling Better?

• Conventional wisdom indicates that people are motivated by the desire to increase pleasure and the need to avoid pain. I think that is too complicated.
• The fact is everyone is out to feel better, and the sole purpose of your business should be to make the customer feel better.
• That’s it, game over. All the bull crap aside, feeling better is all that matters.

Case Study: Dick’s Last Resort

• Dick’s Last Resort restaurant in South Carolina also leads on Quality, but it sure isn’t the quality of the food. Instead, it is the Quality of the experience.
• The wait staff insults guests, mocks their food orders, and forces them to wear goofy hats. It’s definitely not for people without a good sense of self-deprecating humour. But if you like that type of atmosphere, this is the highest Quality experience you can find anywhere.
• How many restaurants regularly get five-star ratings on service and atmosphere when their waiters inevitably says, “Is that all you are going to give me as a tip, you cheap bastard?”

Who will kick Wikipedia’s ass?

• Britannica failed to stay true to, and continually raise the bar in, its Area of Innovation.
• The company was quickly surpassed by Microsoft’s Encarta CDRom, which was later made obsolete by Wikipedia.
• All in the name of the same Area of Innovation: Convenience. Wikipedia raised the bar so high on Convenience (instantaneous and unlimited information) that Encarta didn’t have a chance.
• It also raised the bar ridiculously high on Price (free) and Quality (it is a living file and constantly updates and improves).
• I can’t wait to see who kicks Wiki’s ass. And trust me, someone will. Maybe it will be you.

Business Plan?

• Traditional business training and common logic say this is your starting point for launching a company. They couldn’t be more dead wrong. Starting a company is all about serving your needs, your beliefs, and your values first.
• Three documents will launch your business faster and better than any business plan. With these powerful documents, your growth will be limited only by your beliefs and focus. Trash your business plan right now because I’m about to teach you the power of three sheets (documents): Your Prosperity Plan, Quarterly Plan and Daily Metrics.
• The Prosperity Plan must be all about you and what you envision to be the best, happiest, most perfect scenario for YOU.
• Here are the key elements of a visceral, motivating Prosperity Plan:
  • Life Mission – What is your life’s purpose?
  • Destiny – Once you know your life’s mission, you need to identify your Destiny.
  • Area of Innovation – lead in quality, price or convenience
  • Immutable Laws – your hardwired beliefs
  • Community – the people you are serving

Say No

• When you are starting and growing a business, the unimportant stuff keeps creeping in – the distractions, from reading every email every second it comes in (and clicking the send/receive button a hundred time just to check), to constant instant messaging fests, to “working” on “opportunities” that are not in your niche, to time-chewing meetings that don’t help anyone. You need to say, “No” to this stuff and focus on what is important.
• Another cool thing about saying, “No” to certain people is that they become hungrier. They want what they can’t have.
• For two years I served on the board of the Young Entrepreneurs Organization (now called EO) and was responsible for growing the membership of our local chapter. Both years I won the award for facilitating one of the three fastest-growing chapters in the world (out of 100). For the ten years prior to that, the chapter had grown about 0.5% per year. I bumped that number up to 75% growth per year. You know what I did differently than the guy before me? I said, “No.” I limited admission, telling prospective members they had to pass an approval process to qualify for membership. I rejected everyone the first time around, and those who were eventually accepted couldn’t wait to pay the membership fee. That is the power of saying, “No.”

Haven’t Started Yet?

• Capture your action items
• Prioritise
• Eliminate duplicate tasks that are similar
• If it only takes two minutes do it now
• Eliminate time wasting tasks
• Concentrate your thoughts. Focus
• Turn off email
• Delegate
• Commit to someone else. They’ll hold you accountable
• Make it manageable. Bite sized chunks
• Take a break
• Go in spurts
• Reward yourself
• Make failure VERY painful
• Stop Your Bitching, Bitch. At some point, enough is enough. If you still aren’t taking any action, you should just be embarrassed with yourself. Look in the mirror, acknowledge you have been a pathetic loser to this point, and stop the bullshit now, bitch. Get your ass in gear and starting doing it. Yes, that’s right, I called you a bitch.