Don’t Be An Idiotpreneur

By | Internet Lawyer | No Comments

As an Internet lawyer, I look for lessons in the offline world that can be applied to your online business.

Today’s lesson is about an idiotpreneur profiled in a national newspaper as if she had done something smart.

Ms. Idiotpreneur’s business was going down the toilet. Blaming it on the economy, there were telltale signs throughout the article that the real problem was Ms. Idiotpreneur.

To cut expenses, she traded in her Mercedes for a “simpler” BMW. That’s denial.

Rather than collecting up front for her services or cutting off deadbeats, Ms. Idiotpreneur let 20 percent of her clients receive services and stiff her on the bills.

But what qualified this small business owner for the title “Idiotpreneur” was that she fired herself from her business, giving up her income from her own company, so that her 8 employees could keep their jobs! She took a job elsewhere earning a lot less so that her employees could suck her business dry.

The newspaper tried to spin this as something wonderful. You don’t need to be an Internet lawyer to understand how stupid her actions were.

Your online business is not a charity. It should deliver value to your clients. However, its primary reason for existence is to serve your needs by making a profit. Employees should be treated fairly but they are not “stakeholders” entitled to loot all the profits at your expense.

Downsizing yourself first to serve their needs is idiotpreneurship. And you can be sure that misplaced loyalty would not be reciprocated. If Ms. Idiopreneur had asked each employee to take a pay cut so she could still draw a salary for running the business, most would have quit without losing any sleep over the decision.

If your business becomes a cash cow for everyone except yourself, you have an expensive hobby that robs you of money and irreplaceable time.

To your online success!

-Mike the Internet lawyer

Posted with WordPress for BlackBerry.

What’s the Biggest Legal Issue Small Business Owners Face?

By | Internet Lawyer | No Comments

Time for another contest…

Here’s the question: “What’s the Biggest Legal Issue Small Business
Owners Face?”

It can be any legal issue: brick-and-mortar (offline) or Internet
(online).

What can you win?

1. If your entry is selected as the best (my discretion as judge),
you’ll get a copy of Dan Kennedy’s “No B.S. Marketing to the
Affluent” book shipped to you. Packed with info, it is one of his
best.

2. By simply entering the contest, you’ll get an advance copy of
the guide I’ll write based on the best entry, i.e. you’ll get the
answer to the winning question.

Fair enough?

How to enter?

Simply use the contact form to submit your entry no later than February 18, 2009 (next
Wednesday).

I look forward to reading your entry.

Good luck!

-Mike

P.S. Some legalese. Contest void where prohibited by law.

A Good Year For Buying And Selling Businesses?

By | Internet Lawyer | No Comments

Business brokers think this will be a great year for purchases and sales of businesses. One of the factors cited is Baby Boomer retirement. This will only increase during the next several years as they look to cash out their equity in small businesses to fund retirement.

If you’re considering buying one of these businesses, be sure that you’re not overpaying. Many small business owners have an overinflated view of the value of their enterprises, mistaking personal pride for something that should be part of the purchase price.

One common red flag to consider is the seller who operates with two sets of books – one for the IRS and one which he uses to justify the asking price for his business.

Run, don’t walk, away from such an “opportunity.” The person who commits tax fraud will cut corners elsewhere, leaving you with liability exposure that will outweigh the upside of the deal.