Three Important Business Model Lessons- Mistakes Millionaires Make

3 IMPORTANT

TRANSFORM

business model

Photo via kcustomables.com

to

YOUR

BUSINESS

changes

Excerpts from Mistakes Millionaires Make, by Harry Clark

Take the Entrepreneurial Risk Assessment at: www.pathwaypartnersllc.com

http://www.pathwaypartnersllc.com/

My name is Harry Clark and I thought I had it made.

By 2004, I had:

founded two INC. 500 companies

450 employees

a $100 million net worth

BUT I LOST

EVERYTHING

NO

RESOURCES

I realized that there are

to help entrepreneurs avoid

common mistakes

ENTREPENEURS

That lead me to interview

30

CRASHED

that

spectacularly

CLIMBED

and

back up

SHARE

I want to

what I discovered

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3 IMPORTANT

TRANSFORM

business model

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to

YOUR

BUSINESS

changes

Change #1

RECURRING

One time project revenue vs. REVENUES

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BOB VERDUN

One of the entrepreneurs

Computer Facility Integrators

In 1999, his company had

90% project based revenue

$15 million in sales

150 employees

He is the founder of

I interviewed is Bob Verdun

But then, in 2000

DOT

COM

BUBBLE

THE

BURST

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In just one month

his revenue

dropped by 60%

He almost

LOST EVERYTHING

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He started to slowly rebuild his business

on a solid foundation of

RECURRING REVENUE

BOB VERDUN

Within ten years

It now has

75% recurring revenue

$26 million in sales

130 employees

his company.

he transformed

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MOVE

Develop a strategy to

into a recurring revenue model

Lesson learned

YOUR

BUSINESS

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DIVERSIFICATION

Change #2

REVENUE

The other strategic move

industry

geography

client

made by Bob was an

INTENTIONAL

MIX OF

REVENUE

DIVERSITY

He diversified by

This has helped

create stability and predictability

necessary to plan and manage

his business carefully.


Lesson learned

Develop a

of diversifying

your revenue

sources

DISCIPLINE


RISK

Change #3

GOVERNMENT


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Working with the government is a

DOUBLE

EDGED SWORD

It can provide

STABILITY

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RESPECTABLE PROFITABILITY


And a sense of

HELPING

SOCIETY

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However, based on

INNOVATE

the interviews made,

the more you

the more you are

EXPOSED

TO RISK


Governments generally don’t

INNOVATE

and don’t do well with

PEOPLE THAT DO

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They can attack

VICIOUSLY and in an

arbitrary

manner


Lesson learned

If the business is heavily regulated or

has a lot of governmental revenue,

the more innovative it is,

RISK OF BEING ATTACKED the higher is the

Innovation is

DIRECTLY PROPORTIONAL

to risk

when government is concerned


Learn more by reading my up-coming book

Or by taking the

Entrepreneurial Risk Assessment Survey at

http://pathwaypartnersllc.com/

Or by subscribing

And remember: to my blog

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