I recently wrote an article about why I think you should start a business (and how you can guarantee success).
To put everything in that post to the test, I’m going to run an experiment…
I’m going to start a completely new business from scratch and I’m going to document the entire process!
What’s the point starting a new business after already achieving FI?
As I mentioned in that post, creating a business around one of your interests is a great way to force yourself to dive deeper into something you enjoy.
And as we learned during my recent interview with Cal Newport, going deeper into something results in more happiness and fulfillment.
How this will work
Rather than have multiple posts about this experiment, I’m just going to update this post as the experiment progresses.
I’m stealing this style of posting from my favorite entrepreneur site, MoneyLab.co.
MoneyLab is written by my buddy Matt and is where he runs interesting business experiments, documents all the details, and shares the results.
A lot of his experiments aren’t successful and don’t make any money at all but it’s nice to see that honesty and transparency (especially in the “online business” space).
He also has a really entertaining podcast that’s worth checking out (him and his cohost, Andrew from ListenMoneyMatters, have the best chemistry out of anyone in podcasting so the episodes are always a lot of fun to listen to).
Anyway, he dedicates a page to each of his experiments and updates the page as he goes along and I really like that style so I’m borrowing it for this experiment.
Right Type of Business
The first step of starting a business is to make sure you’re starting the right type of business.
As I mentioned in the other post, you want to choose a business that falls within the diamond in the center of this image:
The business I plan to start is a YouTube channel about synthesizers (yes, I do realize how dorky that sounds).
Let’s see if it falls within that diamond for me…
Am I interested in synthesizers?
Yes, I spend the majority of my free time playing, reading about, and watching videos about synths.
Am I interested in producing videos?
Yes, I’ve been enjoying YouTube more than any other online content recently and the idea of creating my own videos is really exciting.
Do I want to learn more about synthesizers and get better at using them?
Yes, one of the main reasons I wanted to quit my full-time job was so that I can devote more time to music and getting better at synthesizing sounds is one of the most excting aspects of that.
Do I want to meet other people who are interested in synths?
Yes, I’d like to meet musicians who are interested in similar music so this could be a great way to do that.
It’d also be incredible to join one of my favorite bands so that’d be much more likely to happen if I’m already known online as someone who is really good with synths (I know that’s a long shot but most of my favorite bands are small so it is possible).
Do I have skills that I could utilize to get this business off the ground, that I would enjoy using, and/or would like to improve on?
Yes, I’d say I’m already more knowledgable than most about synths so that’s really all it takes to teach others (you don’t have to know everything…you just have to know more than some people).
I’ve realized through my writing here that I’m good at breaking down complex topics into easily-understandable chunks so that skill will definitely come in handy.
I’ve also developed a lot of knowledge about how online businesses work, thanks to the Mad Fientist, so I could utilize those skills to get my site off the ground quicker.
Does it matter that I’ve not produced videos before? Not really. I can learn as I go and as long as the quality isn’t awful, I can’t imagine it will make too much of a difference at first. It is something I’m looking forward to getting better at so that’s more important than being amazing from the start.
Since the business idea falls within the diamond described above, it’s time to see if the business has potential.
The Reddit Test
Back when I started the Mad Fientist in 2012, I noticed that the Financial Independence subreddit had a healthy number of subscribers (50,000-80,000) and was growing.
This is quite a good test for business viability because it shows that…
- There’s a potential audience for what you’re planning to build (e.g. if the number of subscribers is over 10,000)
- Interest in the topic is expanding (e.g. if the subscriber numbers are growing at a good rate)
- It’s not already so big that you’ve likely missed the boat (e.g. if the number of subscribers is over 300,000)
When I started thinking about this idea, the Synthesizers subreddit had around 80,000 subscribers and was growing nicely. Now, it’s over 100,000 and is growing more quickly so I feel I need to get started soon or will be too late to the party.
Note: I’m not saying you can’t start a business in a space that doesn’t have an existing audience or already has a very large one…it’ll just likely be a bit more difficult.
Gap in the Market
It’s also worth trying to identify a gap in the market that you would be happy and able to fill.
When I started the Mad Fientist back in 2012, there weren’t many sites focusing on the hard numbers of early retirement.
Since I’m good at math and enjoy playing around with numbers, I figured I could be the one to build spreadsheets and run experiments to find new strategies to retire earlier.
The reason I keep coming back to this new synth business idea is because I think there’s a gap there that I’ll be able and willing to fill.
Currently, there isn’t a great video series available for beginners. There are some written tutorials but they are overly complex and there are a few videos but they are either really old or not comprehensive.
Since I’ve realized with the Mad Fientist that I’m good at breaking down complex topics and making them easily understandable, I know I can use that skill in this new space to create a free introduction to sound synthesis course.
Do I know everything about synthesizers? No.
Have I ever produced a video series before? No.
That doesn’t matter though. As I already mentioned, I have above-average skills in a few areas and there’s a gap in the market so that should make up for my lack of experience in other areas (just as my math/analytical/programming skills made up for my lack of writing experience or interviewing experience when I started the Mad Fientist).
Potential Revenue Streams
As I mentioned in my start a business post, making money doesn’t need to be the primary goal (especially if you’re already FI) but it does need to be a goal.
The IRS considers a business that doesn’t earn money as a “hobby” and doesn’t let you take all those great business tax breaks so you need to earn money (or be trying to earn money) to make it a business in the IRS’s eyes.
Therefore, it’s a good idea to think about potential monetization opportunities before starting out.
For this new synth business, here are some of my options:
- Adsense – I can run Google Adsense ads on my YouTube videos and earn money from views
- Amazon Affiliate – When recommending synths and other music gear, I can use Amazon affiliate links to earn a commission from those sales
- Syntorial Affiliate – There’s an app called Syntorial that helps train your ears to get better at synthesizing sounds. It’s an incredible app and they have an affiliate program so I could earn money from recommending something that I’d recommend anyway (just like Personal Capital on this site)
- Course Sales – I can sell a downloadable version of the beginner’s course I make
- Custom Patches – I can sell the synth patches that I create
- Advanced Courses – Once the free beginner course is finished, I can create an advanced course that I’ll sell instead of giving away for free
It’s obvious there’s a lot of revenue potential here, especially compared to this Mad Fientist business (i.e. a site where I’m trying to convince people NOT to spend money so that they can get to FI quicker, haha).
It’s also good to think about non-monetary benefits you can try to get with your business.
For this one, here are some things I’ll be keeping in mind…
- Free Gear – If I have a popular YouTube channel that reviews synths, maybe I can get free gear to test out and review
- Free Events – I’m paying to go to a synth festival this year (see below) but maybe I could get a press pass next year, once my channel is more established
I wasn’t planning to launch this business right now but something came up that pushed my timeline forward – Moogfest.
Moogfest is an annual technology conference and music festival hosted by one of the oldest and most-respected companies in the synth game – Moog.
At this festival, you can buy an engineering pass and spend two days with Moog engineers building an unreleased Moog synthesizer.
I’ve been wanting to learn how to build my own synths for a while now and this year, they will be building a vocoder so I knew I had to go.
The engineering pass is really expensive though so I wouldn’t have bought it just because I wanted it.
Since I have been thinking about starting this business, however, I decided to use Moogfest as an excuse to launch my channel (which will therefore let me buy the Engineering Pass as a business expense).
The synth community is really interested in Moogfest so producing videos at the event will be a great way to launch my channel and help me get a name for myself in the YouTube synth space.
I plan to live-vlog the festival, create a cool video of me building the vocoder, and record a bunch of other footage that I can use later.
This brings me to the unfair advantage of FI…
Unfair FI Advantage
I can’t imagine many synth YouTubers have the time or money to get an engineering pass and spend a few days building a synthesizer.
That gives me an advantage and should allow me to create interesting and valuable content that the other channels aren’t able to.
What I’ve Already Done
Since I’m launching this business sooner than I expected, here are the things I’ve been focusing on…
When people search for Moogfest on YouTube and find me, I want them to be really impressed with what they see and I want my channel to look professional (so that people take me seriously and subscribe).
Coming up with a good brand for the Mad Fientist is probably the main reason it’s still around today (check out this article for that whole story).
I think I’ve settled on a name for this new project and have obtained most of the social accounts for that name.
I’ve also designed a logo. Usually, I’d hire my buddy who created the Mad Fientist logo but he’s really busy this month and won’t be able to get something to me in the next couple of weeks so I just created my own.
I can always change it later, just like I did with the Mad Fientist logo.
I created a simple webpage with HTML and CSS that simply displays my logo and has links for my YouTube channel, Facebook page, Twitter page, and Instagram page.
I’ll obviously be adding to this at some point but I don’t have time to get fancier now so this will have to do.
As I mentioned, I secured Twitter, Facebook, and Instagram handles for this new business.
I’m not sure which of those I’ll actually use but it’s always good to lock down everything that you can before you start.
Once I finished my logo, I got some business cards printed so that I can hand them out to people at Moogfest and can leave them laying around for people to find.
There are quite a few things I definitely want to get done before my official launch next week.
Video Intro Sequence
I want to make sure I have my videos branded with an intro sequence so I’m going to need to put something simple together myself.
I’m not worried about making the weird synth noises for the intro but I haven’t done any animating before so I’m not sure what I’ll do for that (may just keep it simple with a static image, until I can get my friend to do it for me later, or I may put a simple animation together in Keynote).
Plan my Trip
I’ll be going to Moogfest alone so I should have plenty of time to record a lot of content (my wife has to deal with enough bleeps and bloops at home so it’s not surprising she doesn’t want to travel to hear more of that).
There’s a lot going on at the festival though so I’ll need to plan what I want to see and think about what videos I want to try to make.
Current Business Statistics
Since I haven’t launched yet, I have received $0 of income so far :(
I have racked up quite a few expenses though…
- Domain Names – $27
- Website – $0 (I hosted my new site on the same Dreamhost VPS that I host this site on)
- Email List – $0 (I already have a ConvertKit account for the Mad Fientist so I just set up a tag for the new site)
- Camera – $599 (Olympus OM-D E-M10 Mark iii)
- Camera Tripod – $17
- Lavalier Mic and Accessories – $75 (Rode smartLav+)
- Moogfest Engineering Pass – $1500
- Flights – $758
- Accommodation – ??? (I haven’t booked yet)
- Synth 3D Pixel Graphic – $58
- Business Cards – $31
The great thing about business expenses is you can use them to offset other income/profits at tax time so it’s like getting a big percentage off of things you’d like to buy anyway (since they reduce your taxable income).
As I mentioned in my start a business post, you can guarantee success if you pick the right business.
Even if I don’t earn a single penny with this new venture, it’s already been a big success because…
- I’ve learned more about synthesizers than I would have had I not started this business
- I’m going to get to attend a fun music/technology conference that I wouldn’t have otherwise
- I’ll be taught how to build synthesizers (something I’ve wanted to do for years) by the engineers at the most iconic synthesizer manufacturer in the world
- I will get to spend time with my family and friends when I’m back in the States on this business trip
- I’ll also get to see one of my favorite bands play a one-off reunion show that I wouldn’t have otherwise (Brainiac!)
- I’m going to learn a lot more about photography and video production (which is also something I’ve been wanting to do) now that I have a proper camera to use
I just published my first video from the footage I filmed at Moogfest and here are my thoughts…
- I forgot how intimidating it is to launch something new for the first time. It’s been 7 years since I started Mad Fientist and the memories of those difficult early days must have faded.
- I underestimated the amount of work that it takes to create a video. The video I released is 2 minutes and 22 seconds long but hours and hours went into making it.
- It’s weird not having an audience. I’ve gotten so used to receiving immediate feedback whenever I publish anything on Mad Fientist so it was weird to work so hard on the video and then get nothing back in return.
I haven’t updated you about this experiment because I actually decided to put it on hold.
Although Moogfest was amazing and I was able to create and publish my first video from the footage I filmed there, I realized afterwards that this project would take me away from what I really should be doing (see this post for what that is).
I have a tendency to “productively procrastinate”, which is to say I do productive things to avoid doing the harder (but more important) things I should be doing. Since I’m doing productive things, there’s less guilt than there is with normal procrastination but it’s still as detrimental.
Since writing and releasing an album is my #1 goal, I need to devote all my time to doing that. So even though synthesizers are related to that goal, creating a YouTube channel about synthesizers would be too time-consuming for the benefit it provides to the album project (since things like video editing, promotion, etc. don’t contribute to the album but take up a lot of time).
I do want to continue with this experiment though so I plan to pick it back up again after my album gets released.