The aim of The Money Mountain is to grow our wealth. We all want to have a few quid more to be able to treat ourselves, those we love or even complete strangers to a little something extra.
By the summer of 2019, The Money Mountain had successfully increased its wealth. We had a pot of money which was sitting idle, not doing anything much at all and every month we were adding a few hundred pounds to the pot. Nice to have but, as flippant as it sounds, not life changing sums, especially when divided by three.
I of course have to caveat this with the obvious statement that to someone out there, the money we made would have been a big deal – it’s frustrating that it needs to be said, but that’s the world we live in these days.
The way we accumulated our stash isn’t remarkable. Anyone can do it with a bit of effort – check out how we think you can realistically go From Nothing to £2500 In One Year, if you have any doubt. This isn’t advice, it’s just to show you what’s possible – without risking a penny of your own, just a little time and effort.
The lure of an online business
All our methods of making money were fine, but they were a grind. We figured that we needed some serious income to turbo-charge our progress. And the more passive that income could be, the better.
Everything we were doing up until that point needed us to be doing something; it carried a time cost which wasn’t always worth it – some surveys were working out at paying around £2.50 an hour – that’s less than I was earning in 1994 washing pots in a hotel kitchen.
All of us have demanding jobs which often spill over into home time, so the idea of giving up precious time with family for £2.50 an hour is not particularly appealing.
But what about online retail? We’ve all heard the stories where people have cracked it and money seems to roll in by the thousands. Yes please, we’ll have some of that. An online retail could make money 24/7 with relatively small amounts of input – or so we thought.
Online businesses – sit around and chat whilst the money just rolls in, right?
Dave has had a successful online retail business for a number of years, there are some things it is better not to know, but one evening Dave came to one of our meetings with a business he’d been told of which was for sale. The business was an online wallet retailer which had started life in Hong Kong, was bought by an American and was now being offered to us for $400.
It had a website, a Facebook and Instagram account with a few thousand followers and a domain name which we figured alone was worth a few quid, so we took the plunge and made the purchase.
Not long until we’re practically printing our own money with this new venture, we thought…
The Wheels Come Off
We set about making the business our own; a bit of back and forth with the seller to get all the passwords and access to various accounts, apps etc and we were away.
We started a Facebook campaign; planned weekly posts each advertising a different brand of wallet we had for sale on the site. We figured with a few thousand followers, all we had to do was post a picture a few slick words and the orders would come flooding in. Wrong. Nothing happened.
Absolutely nothing.
Initial warning signs were that this was not going to be as easy as we thought.
A few more posts; we tried to get creative and posted some videos, we even made our own narrated by Chris in his finest estuary English – surely that would be the key which unlocks the door to untold wallet-based riches? Not a sausage.
With some of the PayPal money still in the account we opted for a few paid posts; these got a little more engagement, but no increase in sales. When I say increase, a single order would have been a result at that point.
A couple of weeks went by and we got our first order; we were, as you can imagine, euphoric. We’d broken our duck and were on our way. Except we weren’t. 3-4 weeks went by before we got our next order, and so it continued. We were averaging a sale a month for a few months and then it went dead. We tried to capitalise on Black Friday, we tried to capitalise on Singles Day, we tried to capitalise on Christmas, but nothing was working.
Our last role of the dice was Chinese New Year. As the majority of our customer base was still in Hong Kong, this made sense, but this was right around the time Covid was starting its march across the world and so life was made that little bit harder. People weren’t going out, restaurants and shops were closing; who needs a wallet under those circumstances, right?
Time to press pause
We made the decision to mothball everything while the world exploded. At very least we’d have lower costs while this was going on, though Shopify even make you pay a monthly fee for a site that is paused.
Up until that point, the business was more or less (emphasis on less) paying for itself. The meagre sales were almost covering our costs, but now we’d have to cover a portion of those ourselves as we burned through the cash in the company account.
While Covid was doing what Covid does we kept asking ourselves the question as to whether it was worth persevering with the business – it had a little bit of the feeling of a gambler chasing their losses at times, but having paid to keep the company going but without any sales, we felt we had to give it another go at somepoint.
The nail in the coffin
As things started to look a little more rosy and the world was enjoying a nice warm summer and low Covid numbers, we opened the business up again. Almost immediately we made two good sales on consecutive days. Once again we thought this was the moment it all came together, but days turned into weeks, weeks turned into months without any further sales. Covid reared its ugly head again and that was that.
Those last two sales proved to be the swan-song – though before natural causes took hold, we unceremoniously took our bird off the river and wrung its neck. We took the tough decision not to put any more time into it.
It was an emotional farewell…
In truth, though, we hadn’t been giving it enough time all along, and that was the big problem. Covid isn’t to blame for the business’ failure. It didn’t help, but it was probably only a small part of the problem.
Having a lack of time and energy to give to it was the killer. We underestimated how much work it would be to fight for a sale in a crowded space and when you are selling a product anyone can sell from anywhere; there was nothing unique in our offering, there was nothing to differentiate us from the other companies offering the same.
A market that we never properly found
Ultimately, we never found a way to get through to our market. Truthfully, we’re still not exactly sure we learned who our market was. There are 7billion people in the world, so it should be possible to sell a few hundred wallets a year, shouldn’t it?
You’d think so, but every man and his dog is doing it, it’s not quite as easy as just setting it up and waiting for the profits to roll in.
Perhaps our skill set was not a good match for this venture. The nuance; the finer elements of trying to make a sale based on a few seconds of video, or inspire a purchase just using an image and a clever line or two of text – we didn’t nail it.
It felt a little like playing darts, blindfolded. We knew there was a chance of hitting the bullseye, but none of our attempts seemed to land – and ultimately we didn’t have time to just keep launching a sufficient number of hopeful attempts out there. Work, fatherhood, and all manner of other commitments dictated that.
Lessons Learned
Call it delusion, but we still hold the view that if we’d had enough time to dedicate to it then the business could have been a success.
As we all know, though, ‘ifs’ and ‘buts’ are not much use when it comes to paying the bills.
Deciding to close the business was definitely a head over heart decision. It hurt but made sense.
It was disappointing to have to close the business. But we got of it with our shirts still on our backs, and it could have been a lot worse. Cliché as it may be, we put it down to a learning experience. And if we had to sum up the key points it would be these.
Firstly, the idea of making money without any effort is mostly just fantasy. Sure, there are people who make good money with online retail, but they put a significant amount more effort into it than we were able to, or harness an audience they’ve already tapped into. Don’t kid yourself of the time and effort needed.
Second, the admin side of running a business is not to be underestimated. We invested a lot of time in setting ourselves up as a limited company, we went through a few tribulations trying to open a bank account and have some expenses to carry even now (closing accounts, ongoing infrastructure costs, and accounting fees). We wish we hadn’t formed a company – there was really no need for something as small scale.
Lastly, getting ‘found’ out there on the internet takes a lot of work and persistence. We know that with our experience on this site. Only after a couple of years of writing articles to a readership of nearly zero readers are we now being found and actually read. If you can’t persist and consistently commit in those early stages when things look desperate, you’re not going to get to the heights where it is worthwhile.
It is said that your first loss is your best loss. I guess you can interpret that in multiple ways. For me it is the cost of getting nowhere which has been the lesson. I have no problem spending money, but waste is unforgivable, so I can’t let this loss go to waste. I have to have learned something from this little venture and right now it is all about sticking to what you know, what you understand and what you can realistically manage effectively. You either do it properly or not at all.