Honing in on Incremental Revenue

Day 39 | $31,450 paid | $59,267 till freedom

I’ve been trying to generate incremental revenue from a number of sources, and it has been much, much harder than expected.

  1. Roommates
  2. Promotion
  3. Landscaping business
  4. SAT prep tutoring
  5. Modeling
  6. Pedi-cabbing

I’m also counting on a tax return, bonus, and RSUs to help me out, but I won’t get that cash until next year, and most of it’s variable, so it’s difficult to bake it into my financial plan with any great confidence.

Roommates
This might be the only bright spot on my top-line trials and tribulations, and even it’s not the happiest story. First, the good news: renting out both rooms is generating cash. So far, I’ve made about $2,400 from the roommates.

Now for the bad news. The first roommate, the one with the car that has an oil leak, doesn’t exactly share my enthusiasm for cleanliness. Now, I’ll admit it, I am borderline obsessive-compulsive about cleanliness and orderliness. For example, when I go back from Ann Arbor, I noticed that the decorative wooden bowl in the middle of the dining room table was not centered perfectly under the chandelier like I like it.

However, I also noticed that the Aqua Fina water bottle she had left in the living room a week ago was still there. In addition, the ground beef that she had moved from the freezer to the fridge to thaw had leaked raw meat juice all over the shelf a week ago, and it still wasn’t cleaned up. The entire garage stank because she had left a bag of garbage from the kitchen on the garage floor because she claimed couldn’t locate the garbage can. She also sliced up a watermelon on the counter and didn’t clean up the sticky juice. And then she somehow lost the cap to my soap-filled sponge (you know, the sponge with the clear handle that fills up with soap), and the soap leaked out all over the counter and left  behind a thick, blue film that she didn’t clean up.

This is what I encountered when I got back from a short, four-day trip. The other roommate, John, who’s exactly like me in terms of neatness, cornered me in the kitchen when he got home a couple of hours later and listed off, in exasperation and frustration, several more of her transgressions, one of which was the complete mess that she had made out of their shared bathroom.

I decided that enough was enough. This wasn’t the first time Sarah had demonstrated a lack of cleanliness, so I decided to take a fairly hard line. The day was October 2nd and I hadn’t received her October rent check yet, so shortly after she got home that evening, I told her that she didn’t have to pay me for the upcoming month, that if she couldn’t find a way to follow the rules from the contract–one of which was to clean up spills and messes–then she could finish up the rest of October at the house since she had already paid her last month’s rent, but then we would need to part ways. I was calm and respectful but also very serious in my delivery. She asked me if this was my “polite” way of asking her to leave. I assured her that it definitely wasn’t, that I liked her as a person, but that it was simply my way of asking her to be more considerate to other people in the house.

I almost launched into a mini HBS lecture on rules-based cultures versus values-based cultures, and how the values-based cultures are far more sustainable than a rules-based one. I decided to save the lecture, but in all seriousness, I could have printed up a huge, long list of rules and spelled out every darn thing the roommates should and should not do, but at the end of the day, the overarching value that all those rules adhere to is respect, and life would be so much easier if she were to just remember that rather than a long list of rules. If Sarah were respectful to the other roommate and me, she would have thrown away her water bottle, cleaned up the meat juice immediately, made an effort to find a garbage can, cleaned up the watermelon juice, and not lost the cap to my sponge and/or let the soap leak and dry on the counter.

Taking that hard line with Sarah, lecturing her on how to just be a decently clean person, was one of the hardest, most unpleasant things I’ve ever done. I don’t want to talk to an adult like they’re a small child, and I don’t want the ensuing weirdness. When I made the decision to take on roommates, I assumed that I’d have to change certain things about myself. For example, I’d have to wear a shirt to walk around the house, not blast my music in the mornings and evenings, and I’d have to relocate my office to my bedroom. But I never thought I’d have to give lectures on cleanliness.

I don’t like to nag people. I’m not a nag! When I was a supervisor in the factory, I hated nagging. And so after I had repeatedly reminded  some of my direct reports to obey a rule like come to work on time or wear protective equipment, and after they continued to step out of line, I terminated them. Four of my direct reports, unfortunately, got a very real and painful sense of how much I hate nagging, and how at their age, they shouldn’t have to be nagged.

I want to get into a position with my roommates where I can actually learn something from them, or at the very least, have some good laughs with them. I’ve already had a couple of good conversations with John.

So for awhile, to maintain peace, I held off. John actually moved in two weeks after she did, and during those first two weeks, when it was just Sarah and me and she kept making messes, I assumed I would just have to chill out and look past them. My college roommates weren’t as messy as her, but I decided I’d just have to be a little more tolerable–paying off debt early isn’t necessarily an easy life, and I assumed that this would be part of the sacrifice.

But when John listed off his complaints, I felt validated, and I realized that I could actually demand a little respect because it wasn’t just me with the problem, and furthermore, she was jeopardizing another source of my revenue.

Sarah ended up giving me her rent check that night after our little talk. The following evening, while I was at the gym, she ended up slicing off a small part of the tip of her finger (skin only, no blood) while she was using a cheese  grater. She ended up going to the emergency room, but John told me she took the time to put everything away first before she rushed off. Bless her little heart, she was learning! I felt terrible when I heard that part of the story, but a part of me secretly admired her effort. Of course, she did leave blood all over the roll of paper towels and on the white pantry door, but I managed to find it deep within my own heart to forgive her for that (wink, wink).

Thankfully, Sarah made a swift recovery, and I’m very happy to report that the kitchen and bathroom have been spotless since her return from the hospital.

Sarah’s probably going to make it and it’ll be her who decides when she can’t take my standards anymore, not me. I do enjoy her company, so hopefully she can make a full adjustment.

John, on the other hand, probably won’t last much longer, but for very different reasons. He moved out here for a new job and left his wife and kids back home in another state so they could sell their house and then join him afterwards. He figured this would take at least until July given the state of the economy, and he was prepared to stay at my place until then. However, his house went under contract only four days after he listed it! A big congratulations to him, and he’ll definitely be missed. He thinks he’ll be living here for another month or so, and then I’ll have to find somebody else. The only thing that might keep him here longer is if his wife, who’s a teacher, doesn’t break her contract to move out here during the middle of the school year.

Promotion
I thought the promotion in my day job would help me out with my debt-paydown mission, but I’m now having serious doubts about that. I used to be a product line manager, which basically meant I was a babysitter for Engineering, Operations, Sales, Marketing, Tech Support, Supply Chain, and Public Relations and Social Media, and I made sure that they were making decisions regarding my product line that positively impacted profitability and the customer experience. It was a lot like herding cats. I’m transitioning out of that role into a strategic alliances/business development role with two of our biggest suppliers–one’s a Fortune 50 company, the other somewhere between 300 and 400. They give us money to co-market our product which has their product inside it, and my job is to work directly with them and our marketing team to make sure that the funds are being used effectively–so effectively that the two suppliers increase the amount of money they give us each quarter. It’s a great role in that it’s more marketing-focused than my previous role and it’s an external role as opposed to my old, internal-only role. It involves a lot of relationship-building, an aspect I’m excited about.

It also means I got a 6% raise.

Unfortunately, it also means I’m working a lot, lot harder. In my old job, I was working only eight hours a day. I had been in that role for a year, had mastered it, and could add significant value without working significant hours. Unfortunately, I’m now training somebody else to do that job, and I’m ramping up in a new job, so I’ve been putting in 12 to 15-hour days. And since I try to work out five days a week, all on the week days, I’ve typically been leaving the house around 8 AM and getting home around 10 PM or so, eating dinner, then going to bed. This explains my lack of posts during the past couple of days.

Unfortunately, working fewer hours isn’t exactly an option. First off, I don’t want to drop the ball because I’m intrinsically motivated to perform; I’m not going to settle for a second-rate job out of myself. I’m also intrinsically motivated to get out of this debt, which will require a very decent  bonus, but the timing of this transition really jeopardizes that. I took a risk when I took on a new role. I could have stayed in my old role and passed on the 6% raise, but I would have gotten a very solid bonus since I’m the second-best product line manager on the team, according to my boss, and bonuses are awarded according to a meritocracy. That bonus would have been greater than the 6% raise and the bonus  in my new role. I won’t be ranked as highly in the new role as I would have been in the old since I’m so new compared to everyone else who already knows what they’re doing, and that will be reflected in my bonus.

However, I went after the new role because I wanted to try something new and broaden my horizons, and immediate pay-out wasn’t a huge concern at the time since I started the job search before I started my NMHD mission. Unfortunately, the decision on the bonus amount is made in December, it reflects my performance from February and December, so it will be made by my old boss and my new boss. If my old boss thinks I slacked off in training my backfill, then he won’t give me a good review. If my new boss thinks I didn’t ramp quickly enough and am not performing at a reasonably high level, then he won’t give me a good review, either. So that means I have to work more than I did in my old role just to make sure I get a good bonus.

I’ve predicted an $8k post-tax bonus, but it could be lower if my old boss and new boss think I’ve handled the transition poorly. On the other hand, it could also be much higher if they think I handled it well. It could probably be up to $15k. Well, the projected delta to my goal assuming an $8k bonus is sitting at about $5.5k. So if I nail this transition, do an outstanding job of training my backfill, don’t drop any balls, and hit the ground running in my new role, I could really be sealing the deal here over the next three months. If I can upside that baseline bonus, it means that finding extra revenue by working other jobs isn’t critical. It also means not having to sell any cars or my motorcycle.

Unfortunately, I won’t find out the bonus amount until April, which would leave me with only two months to react if it’s closer to $8k than $15k. So I have to work my heart out right now at my day job and try to find incremental revenue via side-hustles since I don’t know how the chips are going to fall next year regarding the bonus.

Landscaping Business
Michael and I having a tough go at making inroads with the landscaping business. While I was in Ann Arbor, Michael got our first call from a potential client who requested a quote. She requested irrigation work, which we won’t do, so excluding that, we’re looking at $600 profit, or $300 each, for roughly 10 hours of work which we can easily knock out on a single Saturday.

We won’t touch irrigation work with a ten-foot pole. First off, it’s a huge liability and we’re not insured, and second, we have no idea how to do it. Unfortunately, she told us not to give her a quote unless it also includes irrigation work. The problem is that the irrigation businesses in Austin have been completely unresponsive to my request to partner with them on this yard. They took over 24 hours to return my initial phone call, and once they found out what I needed, they told me they’ll get back to me after they take a closer look at the diagrams that I’ve emailed them, but another 24 hours have elapsed and they still haven’t.

I get it–they’re busy. Austin hasn’t seen rain since April, so everybody wants work done on their irrigation systems. It just sucks that after we got radio silence from the entire market for a month, we finally, finally have a potential client, but we might have to watch the entire deal implode in front of our eyes because of a freaking partnership thing. It’s ironic that I just took a role in strategic alliances–you’d think I’d be good at this thing! I really don’t know what we’re going to do about this.

SAT Prep Tutoring
Last Tuesday, Ryan from the SAT prep class asked me to come back that Thursday for a third and final session on which he’d base his hire or no-hire decision. I had to miss that session since I was traveling at the time, but he told me to call him back when I got into town on Monday.

It’s now Wednesday night, and I haven’t called Ryan back yet.

The thing is, being an SAT tutor is a lot of work for not a lot of pay-off, and I think that’s what readers’ negative comments were getting at. (I know, I’m Sherlock Holmes.) It’s $25/hr, three hours a week, for $300 pre-tax per month. At this point, I could make $2,400. The position does require some prep time as well, so the effectively hour rate is definitely south of $25.

I was pretty hot on this job before we got our first customer call. Last week, I wasn’t sure what would happen to the landscaping business, and I’m still not, but when we had zero calls under our belt, I was pretty convinced that the business might  completely fail. But when we got that call from the customer and the quote came in at $300 profit for a single weekend day of work, I got really excited, and tutoring lost its last remaining bit of luster. Unlike tutoring, the $300 would come in all at once on the weekend, I’d be able to continue to focus on my job and the gym during the week, and I’d be doing something I enjoy–working outside with my hands.

With my new job and all the time I’m spending ramping up in it to secure a good bonus, and all of the happy hours and after-work events with my external partners that I’ll have to participate in so that I build good rapport with them so that they give my boss good feedback about me so that I get a good bonus, there will be precious little time to tutor kids for three hours after the end of a work day. Heck, I had to leave work at 4:30 PM just to make it to the training sessions. I could do that last week when I was still working my old role full-time, but now that I’m transitioning and in the spotlight, I can’t be skipping out of work at 4:30 anymore.

I think the SAT prep tutor thing has met the same demise as pedi-cabbing. It’s just not a good fit. Another one bites the dust.

Modeling
And yet another one bites the dust. That’s right, after reaching out to a friend who lives here in Austin and knows the industry, I’m making a no-go call here on modeling. This is what he had to say:

With regard to the modeling agency you mentioned, I am not familiar with them so I can’t really comment.

There are agencies and photographers that have a business relationship and they feed every model prospect that walks in the door to photographer X for a $400 head shot session. The price seems about right, but I would ask them for an honest assessment of how much “modeling” work is actually placed here in Austin.

The vast majority of models I have worked with that do commercial modeling have commented that they almost always have to go to Houston or Dallas for jobs since very little commercial work is created in Austin.

I would ask them to talk to a couple of their male models in your age range and find out how much work they have secured for them in the last year.

If “signing” with them does not cost you any money and you can still get work on your own – it probably can’t hurt. If their agreement prohibits you from getting work on your own or working with others you need to really press them to see how much work you are realistically going to get and decide if its worth being tied to them for a year.

You have to decide how much travel you are willing to do to get work. Generally speaking if you have to drive to Houston or Dallas you probably won’t be paid extra for that since there are plenty of models that already live there. It’s the same reason agencies in NY or LA will seldom sign a model that does not live there already.

Hope this helps!

So pedi-cabbing, SAT tutor prep, and modeling have all been false starts. I am still completely gung-ho on this landscaping thing, and I have high hopes for it.

Three Foci
For now, I’m focusing on three things for incremental revenue: roommates, promotion/bonus, and landscaping. The roommates thing is on cruise control for now. The bonus can literally make or break my entire mission, and the landscaping is the hedge (no pun intended) for my bonus not coming in as high as I want it to.

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2 Comments

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2 responses to “Honing in on Incremental Revenue

  1. Barbara

    I am wishing you all the best and praying for you too!

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