The Million Dollar Tattoo

Learning how to turn ideas into action

Why a Homeless Man Makes More than You

As I was walking home late last night I passed a homeless man sitting next to a McDonalds, looking disheveled and waving a soiled hat in the air. He said nothing, and wasn’t even looking up from the pavement in front of him yet, when I passed by, I still dropped 50 cents into his hat.

This made me realize that on this day a homeless man had made more money from a single customer than most internet businesses make from thousands (not including advertising).  Why?

The man’s whole spiel was holding a well-worn hat in the air at passers-by. Nothing special about that. He didn’t do any marketing prior to me randomly walking by. Matter of fact, there was only one reason that he got any money at all.

Not pity. Not empathy.

It was because he was asking for money. Admittedly it was possibly the least energetic sales pitch possible, but he had a clear objective and was acting upon it. For whatever reason he felt that he deserved money, and he decided to ask.

Looking at the thousands of websites popping up every day (you might even be launching one of these services yourself) you will notice a big difference: None of them are asking for money. They have nothing to sell, to anyone. They are practically begging, but merely for attention, not for the surest metric of all: cold, hard cash. And when you don’t ask, you don’t get.

And that’s why, if you’re one of those thousands of businesses, a homeless man will continue to make more money than you do.

Please note:

*Free + Advertising is not a business model, it’s a tactic. It’s a side-effect revenue stream that might bless you once you’ve  built a valuable, content-rich and popular website, but if it is your only envisaged revenue stream then you are in big trouble.

*Giving the man a coin out of my pocket was practically friction-free. If you can work out the digital equivalent of flipping a coin into a hat then you are going to win – BIG.

*You are gambling with your money if you don’t have a product/service to sell to somebody. If you just want to write a blog or make a cool little entertainment site, then that’s fine – but it’s a hobby, not a business. If you aspire to create a business then you better have a business model, especially if you plan on taking outside funding.

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