Seth Godin is a leading voice on marketing, especially marketing as it is changing due to major Internet-driven changes in our world. He also likes to talk about making a maximum personal impact, a topic I care a lot about. Reading his stuff keeps me inspired to start things, live with courage, and make a difference.

If you are involved in selling, promoting, influencing, or communicating anything, you must subscribe to his blog. His post today preparing for the breakthough/calamity is absolutely right about how success and failure normally happen.

Here are the books Seth has published. I think “Permission Marketing” is the most important.

Enjoy.

In 2005 I had a freelance software development business, and one employee. The software business was doing very well. I was grateful, and I was having a good time being full-time self-employed for the first time in my adult life.

But I was afraid. The software business had become increasingly specialized, to the point that all my customers were users of the same software package that I didn’t make or sell, but I provided services and add-ons for. I was afraid that someday that software package would go away all at once — be bought out, shut down, or replaced. I thought about how bad I’d feel if I had to tell my one employee he was out of work because something like that had happened.

So I was looking for a second business to start, as a backup plan.

It happened that this employee (Phil Gioja) and I had a common interest. He had majored in film production in college, and I had majored in video broadcasting. (Full disclosure: He graduated, I dropped out.) We got the idea in our heads to put a studio in our unused office space.

I really wanted to do it. It sounded so fun. I felt guilty about it. It wasn’t practical. In one conversation about it, I said to Phil “We’ll probably never make any money on this.” Boy am I glad we started that studio against our better judgement.

I was right, the studio was a lot of fun, and it never made any money. But in the process of building that studio I designed the acoustic panels that became the spark of that second business I was looking for. The acoustic panel business grew into a big success, and the software business ended just the way I’d feared, becoming obsolete about one year later.

If we hadn’t gone ahead with that passionately interesting, impractical, money-losing studio idea, we would have been in a really tough business situation, and more importantly would have missed out on a huge business opportunity.

Starbucks started in a similar way. The first store sold coffee beans and tea bags, not prepared drinks! The initial vision of the founders didn’t work very well, but it was the incremental step that opened the door to something that worked much better.

Start things. Try things. You’ll probably create a stepping-stone to something you never imagined.

Willingness to try things that will probably fail.

An idea for a product or service that:

1. People find helpful
2. You can execute/deliver better than the competition, and
3. Lends itself to spreading the word cost-effectively.

Access to enough cash to develop and test-market the idea on the smallest scale necessary to find out if it’s viable.

Willingness to risk losing that cash.

Discipline to complete tasks consistently.

Perseverance to fight through obstacles and setbacks and still reach your goals.

Ability to account for and interpret the financial realities of your business (cash flow, income, expenses, profit, debt).

Over the last couple of months I’ve been focused on planning for the physical space needs of my companies. We’re located on Main Street, the former downtown retail block in a very small town of 850 people. It’s the kind of place you would have seen general stores and barber poles 50 or 100 years ago.

Over the last few decades large discount retailers gave America the cheap goods we wanted, and wiped out small town retail. Now most of the buildings are vacant. Some of the buildings have been torn down, leaving empty lots like missing teeth between the others. Some of the buildings are in disrepair. Three buildings now house my companies. We take a lot of pleasure in putting them to use and keeping them up.

Now that we need more space, I thought it’d be easy to buy some buildings or land that nobody seems to want and nobody seems to be doing anything with. We now have a deal in the works, but it turned out to be much more difficult than I thought. Here are some reasons why:

• When the cost of tearing down a building is $30,000 and the going rate for empty lots is $4,000 tops, a lot with an unusable building on it is worth negative $26,000. Try offering that building owner negative $26,000 and see if he wants to sell.
• Later on, when that building owner paid that $30,000 to get the building torn down, he might get the idea that he is taking a loss if he sells the lot for anything less than $30,000. So he prefers to sit on it. (This is an error of sunk costs, but error or not it prevents a deal.)
• When the going rate for a lot is so low, and there’s a small chance the owner might want to use it for something someday, keeping it “just in case” appeals to some owners more than the little cash from a sale.
• When it’s visibly obvious to everyone that my companies are bursting at the seams, and their land happens to be next door to mine, it can enough to make the asking price go through the roof. This is “market impact” and in big liquid markets you can pretty much ignore it, not so here.
• When a building is abandoned by it’s owner, and the property taxes go unpaid, the building goes into a legal limbo for at least three years before the county can take possession and auction it off. During that time, back taxes accumulate with interest and penalties, and can easily add up to more than the building is worth, especially if it has fallen into disrepair. This creates another negative net value situation, making it hard to do a transaction. There are at least two buildings on my block in that scenario now.
• In an illiquid market with very few buyers, very few sellers, and very few transactions, these and other factors add up to high bid/ask spreads, you might say. A seller who wants to get out now may not be able to, even at a price close to $0. And a buyer who wants to make a transaction happen quickly may find nothing offered at less than sky-high prices. The same thing happens with very illiquid financial securities on Wall Street, but I didn’t expect to find it happening on an old main street.

So there you go, some reasons why something nobody wants can be hard to buy.

I love work. I have an incredible job. I’m very comfortable digging in and pressing toward our company goals. This weekend I did something that’s a lot less comfortable for me, taking a trip “just for fun”. I took my 10-year-old son on a father/son trip to Legoland Florida.

Don’t get me wrong, the warm weather felt great and it was awesome to be with my son for so many hours in a row. I can even rationalize that the trip was great for generating new creative ideas for work (which it was) or it was about building a relationship (which it was), but I still find myself looking over my shoulder expecting to have to justify to someone why this trip was worthwhile.

A mentor of mine once said “You know, you are really serious, I want you to have a fun side in your life.” I asked “What are the benefits of having a fun side?” He listed some benefits and also said “it’s kind of a problem if you’re asking that question.” I guess I don’t have much practice spending real time and money on things that can’t be explained in “productive” terms.

I have no advice on this subject (clearly I am not qualified!) but I share this in case some of you can relate. I want to choose what I do and where I go based on my values, and on who and what is important to me, not based on what someone else might think. I want to live purposefully, not fearfully. I’m working on it.