Revenue Modeling 101..continued...

Time to jump in and figure out this whole revenue modeling thing.  Looking a the article Four Revenue Models and Examples for Small Business http://plantostart.com/revenue-models/ from the website www.plantostart.com this is what they have to say about the Recurring Revenue model...

"The recurring revenue model.  It is every entrepreneur's dream, but few will achieve it.  It is often the most desired revenue model by businesses of all shapes and sizes.  What makes recurring revenue so special?  Two words:  profit margins and revenue stability.  Basically you create something one time, and it sells over and over again."

Now, I have to admit, when applying this idea to CKF, it got a little confusing to me so  had to take to the interwebs to get some further clarity on recurring revenue and what that could actually mean for my business. (I found that clarity here... http://www.davemanuel.com/investor-dictionary/recurring-revenues/ ).

DaveManuel.com used these examples that helped clear things up for me...

"Example #1: A software company sells annual licenses for its business software. At last glance, 30,000 different companies were paying for annual license.  This would qualify as "recurring revenues" as these revenues will show up year after year.

Example #2: A website owner runs an investment newsletter that charges $19.95 per month.  Subscribers are billed automatically every month.  This would qualify as "recurring revenue" as the revenues occur again and again, month after month.
Using these concrete examples, I'm going to attempt to apply the Recurring Revenue model to CKF, here goes...

Inspired from Example #1....in 2014, I will be offering licensing to fitness professionals that want to teach CKF.  The license structure has four tiers to it: Instructor, Lead Instructor, Advanced Instructor, and Elite Instructor.  At the Instructor level, fitness professionals are licensed to teach Cardio Kung Fu.  At the Lead Instructor level, fitness professionals are licensed to teach Cardio Kung Fu and either CKF Sculpt or CKF Core.  At the Advanced Instructor level, fitness professionals are licensed to teach Cardio Kung Fu, CKF Bootcamp and either CKF Sculpt or CKF Core.  At the Elite Instructor level, fitness professionals are licensed to teach every CKF workout.  The tiered structure makes it convenient for the fitness professional to advance his/her license as their fitness practice expands. Licenses are renewed on a yearly basis, making licenses a yearly recurring revenue item.

Inspired from Example #2...with a target launch date of November 1, 2013, website memberships will be available that will offer members access to tools to stay on track with their workouts and food plans, an exercise library, progress charts, message boards, and daily messages.  Website memberships will be offered for a low monthly fee, making these a recurring revenue item.

I think that's about it for the Recurring Revenue portion of my revenue model.  Next up, Transaction Revenue modeling....

Revenue Models, 101...

I’ve got this notebook in which I’ve been writing down everything I’m working on for CKF.  In there I have outlines for workouts, contact information for media folks, brainstorming notes, brain-dumping notes, webinar notes, you name it, if it has to do with CKF, it’s in there.  As things are starting to ramp up, one of the things I have notes on, but haven’t done any real work on is revenue modeling.  I’ve got ideas about how much I want to make, I’ve got ideas for programs, I’ve got ideas for products, but I don’t have these ideas captured in any organized fashion because I don’t really know how to create a revenue model from scratch, so I’m going back to school.  Well, not really, I’m going sit here in my sweats and search the internet to learn how create a model for CKF. 

The place I’m choosing to start is with this article:

http://plantostart.com/revenue-models/

This article outlines four basic models, recurring revenue, transaction revenue, project revenue and service revenue.  After a quick skim, it seems like this whole revenue modeling thing won’t be as difficult, or as easy as I imagined.  It seems less difficult because now at least I have a place to start.  It seems less easy because CKF has several moving parts so I’m guessing I won’t discover it fits nicely into one of these models.  In order to come up with my model, I’ll apply CKF and all its moving parts to these four revenue models and see where I end up.

First up, recurring revenue….

time management, ninja style...

I start my new full-time job tomorrow so one of my to-dos this weekend was to come up with a master schedule for all the things I have going on my life.  Working part-time offered me a little flexibility in terms of when I chose to work on building CKF, or when I vacuumed or did laundry or cleaned the bathroom or ran errands, you get the picture.  Now I’m trading in that flexibility and you know what, that’s a good thing for me.  When it comes to time management, I need structure to feel like I’m accomplishing things.  If I just start with a long to-do list and have all day to do it, at the end of the day, I don’t feel like I’ve accomplished much.  That’s probably more a function of my tendency to put way to many things on a to-do list when it seems I’ve got all the time in the world to get them done.  So this will be good. 

Because I don’t have a ton of time, I’m going to write my schedule while I’m writing this blog post, a time management two-fer if you will.  My first step…what are the things I want included in the schedule?  Because I can waste all kinds of time writing list after list and can devote hours keeping multiple calendars, and because I have a lot going on in all areas of my life, it would probably be the most efficient for me to have one master schedule that includes Cardio Kung Fu, work and my home life. 

OK, so I’ve got three categories for my schedule: CKF, work and home life.  My second step is map out the basic tasks that need to be completed weekly, at least for CKF and for my home life.  I’m not sure that this needs to be my second step but my rationale is that there are some things that need to be done in my mind and I’d rather have the management part (the tasks) of my time management schedule drive the time part rather than the other way around. 

What are my tasks for CKF? Twitter, Facebook, Blog posts, classes, bookkeeping.  Obviously there is more work to be done, but for a start, while I’m working full-time, the purpose of this list is just to make sure there is time scheduled to get those daily and weekly tasks done.  Clearly I’ll need to schedule more time than is needed to complete these tasks so I can also do the building part of the business that doesn’t fit into a neat weekly to-do list like researching sample class locations, writing instructor manuals, attending conferences, etc.

What are my tasks for my home life?  Grocery list making, menu planning (yeah, I’m starting with food, don’t judge, I really like food) working out (on non-class days) vacuuming, dusting, cleaning the bathroom, cleaning the kitchen, straightening the house, windows, laundry, floors, bill paying, homework check-in with the jr ninja, Kung Fu lessons, cooking, brushing the dog, walking the dog…I’m sure I’m forgetting something here but this is a pretty good start.

I’ve got my lists of tasks, I guess next step is to create the schedule.  For this I’m going to take to the interwebs for some help…

The first one I came to was this one…

http://office.microsoft.com/en-us/templates/daily-work-schedule-TC102780252.aspx

This is good, but I want a place to put daily to-do’s as well.  I don’t want to list actual tasks in time part of the schedule.

The next one I came to was this one…

http://www.youtube.com/watch?v=Hsijk3l5vjQ

This is not helpful  for what I’m working on right now, but I’m including here because I’m in love with organizing CKF projects this way.

Back to the task at hand, so I kept looking for ideas but I kept coming up with sites that only allowed me access if I joined their mailing list.  I found this ironic as joining their mailing would add yet another task, in the form of “delete uses sales pitch emails” to my to-do list.  I decided to look at the original template I found and tweek that one a bit. 

The result of my first stab at this is below…

Day/Time	Priority	Daily Tasks	Multi Day Tasks	Weekly Tasks
Week Days		Twitter	Blog (tue, thur, sat)	bookkeeping
5:00 to 6:15	CKF	Facebook	laundry (mon, fri)	clean bathroom
6:15 to 7:00	get ready for work	brush Dru	vacuum (tue, thur, sat)	clean kitchen
7:00 to 7:15	walk Dru	straighten house		dust
7:15 to 5:45	work			floors
5:45 to 10:00	home-life			windows
				bill paying
Saturdays
6:00 to 9:00	CKF
9:00 to 12:00	home-life
Sundays
6:00 to 11:00	CKF
				home-life
				CKF

I’m sure this will change, but this is a good first stab I think. 

Check back on Thursday to see how I’m doing so far.

Launching while working, a pro's and con's list, and this one blogger that convinced me I got it right...

Cardio Kung Fu is growing, however, so are our household bills.  In December I took a little hiatus from full-time employment to focus on what our family needed (me home more with more flexibility while my husband traveled for work) and started working part-time.  This was ok for a while but recently it became clear to me that I needed to go back to work full-time.  I’m not independently wealthy so I don’t have the luxury of losing money while I get CKF up and running and working part-time, while the flexible schedule was awesome to begin with, has felt more like being held hostage as time has gone on.  I couldn’t get into a rhythm of working on growing CKF with my schedule changing every week (not to mention not being posted until a few days before the week actually started) and my stress was mounting with each barely-over-minimum payment I was making on my one credit card that has a balance on it.  After much consideration, a couple of weeks ago I decided to start looking for a full-time gig again.  Part of this contemplation included looking at pros and cons.  The pros, money, a feeling of purpose again doing work that was appreciated, structure, stability, vacation days, sick days.  The cons, no more full days off to build CKF, and, well I couldn’t come up with anything else.  Since I wasn’t actually using the full days to build my business (there were also pesky things like laundry, vacuuming, cooking, etc to  catch up on since my work schedule was so all over the map) I decided there really wasn’t a down side.  CKF is a new fitness program and the way I’m building exposure is by adding community education sites and that I can do while working.  It’s going to take time before I’m a household name so I figure why not have a stable income in the meantime.  I also know myself well enough to know I’m at my most effective when my schedule is full.  A full schedule means I don’t have time to waste on actions that won’t garner results.  And that’s just what this guy said so if it’s in a blog on the internet, it’s got to be true, right?

http://chrisguillebeau.com/3x5/starting-a-business/

Oh, and BTW, I start my new full-time job on Tuesday…

I'm scared the spiders, snakes and the phone...

A couple of weeks ago, I taught a class at the Athleta store at the Mall of America and it was an awesome experience!  I had 7 students for the class and at one point, one of them said “this workout is better than coffee.”  Teaching in this kind of setting was a totally new experience.  Up to this point, I’ve been teaching through community ed programs as an employee so getting this gig was new territory for me.  I didn’t get paid for it, these are sample classes so it’s more about exposure for my business but I sought out the opportunity, followed through and I’ve been asked back to teach again in June. 

What I’ve learned from this is that I should be open to checking out new opportunities, even if they are scary for me.  I’ve learned that fear should not be a good enough reason to not take chances.  Filling out applications for community ed programs and sending them in is easy.  Communicating the awesomeness of Cardio Kung Fu in writing isn’t scary to me.  Picking up the phone or walking into a new place to communicate that awesomeness person to person is amazingly scary to me.  I don’t know way.  It’s not the actual communicating part, once I get going on CKF, I can’t stop, I love the program I’m creating and I believe in it.  I’m learning new things each day and each evolution of the workout makes it better.  It’s exciting me.  It’s my passion.  But if I have a call to make, I will do every other thing on my to-do list and then find any excuse to put it off when I’m done with the list.  “Hmmm, it’s almost lunch time, really 9:45 AM is close to lunch, I’ll make the call after lunch.  Yes, I’ll watch Star Trek the Next Generation on BBC America and do a little research on business accounting until after lunch and then I’ll make the call.”  This is an unfortunately familiar scenario.  And this was the scenario the day I actually ran out of tasks on my to-do list, lunch was over, the cable went out, and the house was completely clean.  Left with no other alternative (I couldn’t even walk the dog, it was raining and when she goes out in the rain she continually ducks her head like she’s being pelted with BBs so she mostly refuses to set paw outside) I picked up the phone and called Athleta.  I didn’t actually speak to the right person that day but I did get the right person’s email address and ultimately made the connection I needed to make to get the class.  If I hadn’t picked up the phone that day, I wouldn’t be teaching another class in June, where I’ll get to introduce new folks to the CKF workout. 

I think part of the reason this is difficult for me is the very real possibility of rejection.  The last two and half years have been the toughest of my life.  I lost the job I thought I’d retire from and even though I have a Master’s degree, I haven’t been able to find a full-time job.  I’m not supporting myself with my income right now and that is both scary and self-confidence decimating. With each rejection on my job search I lose a little more confidence in myself.  I’m not sure how much rejection and disappointment one person can take but most days I’m pretty sure I’m coming dangerously close to that line and I’m not sure what’s on the other side.  Most days I want to give up but what’s on the other side of giving up?  If I don’t pick up the phone when I’m working on my business, I won’t be rejected. So there’s that, but I also know if I don’t pick up the phone, if I don’t take that risk, success will be limited.  If I hadn’t picked up the phone that day, I’d still be walking by Athleta on my way to my part-time job, wishing I could be on their board of upcoming classes and day dreaming about how cool that would be.  I’m also hoping that the more I pick up the phone, or walk into a new place, the more comfortable it will become. 

Slow and steady wins the race...at least I hope so anyway...

It's May 16, five and half months into this little venture of mine and I'm feeling a bit discouraged.  Even though I know I've made progress (I passed my CPT exam, I'm almost done teaching my second session of CKF through Minneapolis Parks and Rec, I've taught a sample class at Athleta and I've been asked back to teach in June) I'm having a difficult time staying positive.  My "job" has become a major source of stress and the hours are totally erratic, making it difficult to settle into a routine for building CKF and my husband is now traveling every single week, leaving all the duties of our family and home to me.  Add to that the fact that my carpal tunnel has gotten so bad my fingers are numb most of the time and I don't have time to schedule the surgery, nor does the hubby want to pay for the doctor bill and I'm staring down a future of not having full use of my hands.

Long and short of it, I'm tired.  If CKF was built to the point where I hope it will someday be, things would look different right now.   I wouldn't have the erratic job, I'd have the flexibility so that shouldering all the duties of family and home wouldn't be so overwhelming, and I'd have enough of my own money to pay for the surgery I need.  So what's a ninja to do?  The only thing a ninja can do, keep on going, keep working the job so the bills get paid, keep taking caring of my son, dog and house, because nobody else will, and keep on building CKF with whatever free time I have so someday I can get that surgery.

I wish I could say I'm feeling less discouraged, but I'm not.  Of course, that might be the chili and tator tots I just ate for dinner.