The REAL Cost of Free

I believe entrepreneurship is “challenging” because it requires a different type of thinking…

A way of thinking that most people are not normally exposed to. A way of thinking that often contradicts what we’ve learned in school and society.

Entrepreneurship insists that we dismiss our limiting beliefs. Especially those beliefs that include loopholes and bargains, because “free is good” or “cheaper is better.” Because entrepreneurship insists that we invest in ourselves.

Video: The REAL Cost of FREE

Especially at the bootstrapped, start-up level, how many times do we make business/life-changing decisions based on the cost or investment of a software, service, employee or solution.

Just this morning, I saw a request in a Facebook Group for anyone’s recommendation of an email marketing management solution… “but it must be cheap, I don’t want to spend a lot of money.”

What we fail to ask is, “what is the COST of going the cheap route?”

What is it really costing me to do it myself (hey, it’s cheaper, right?) or go with a free solution?

I believe we don’t ask these questions, because we won’t like the answers.

When I began asking these questions, I discovered I was playing small.

I see it a lot. The entrepreneur who looks at his or her current reality (no money in the bank, little revenue, etc) and they make all their future actions BASED on that PAST reality.

What we fail to do, is create a BETTER future that has nothing to do with our current or past reality. This simply keeps us stuck.

For example, let’s say Business Owner A sets out to build a $20,000/month business. But today, they only make an average of $1,000 month.  Do they ACT, BEHAVE and make decisions like a $240k/year business, or a $12k/year business? Chances are, they behave like the $12k/year business. These are two very different ways of being and acting.

So, they remain stuck. They opt for the free tools that don’t work as well. They say no to help and decide to “do it all themselves” because it will “save money.” They stay in lack, fear and survival mode.

But the real question is, “would a $20k/mo business do any of that?”  No.

The “trick” is to be able to make decisions based on where you want to be versus where you are currently. Sounds simple, but it isn’t always easy.

I remember a time when I had around five dollars in my bank account and didn’t want to spend money on anything. I would look for ways to cut corners and avoid costs by taking free courses.  This was the time I worked the hardest and longest hours. I was the most frustrated and unhappy.

On the other side you see these successful people who know the impact one ounce of knowledge or  a simple piece of software can have on their business. They aren’t afraid to spend money to solve problems; therefore money becomes a replaceable resource to them. Time is not.

I encourage everyone to reach an understanding that there are so many other opportunity costs involved in running your business.  Forget the money for a second. What about the cost of your TIME, your ENERGY, Professionalism, Quality, …to name a few.

Make every choice through the lens of…

“Would a $______/mo business do this?”

 

 

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Comments

  1. says

    Love this one James! I am smack dab in the middle of that question and your post today is #3 “sign from the universe” today (and it’s only 1/2 over!) that I need to keep investing in going BIG. Thanks!

  2. says

    I’d say that sometimes, especially when people are just starting out, they give away a lot of valuable information for FREE. It’s just a way (pretty reasonable one) to get out there by showing everybody what you know and are.

    Therefore, in my opinion you have to be very picky when getting something for free from someone you don’t know, but also there’s a lot of Valuable information for free and it can be a game-changer in many cases.

    I personally have free products and also have “bought” a lot of free products and know that sometimes it’s a crap, but sometimes it’s worth it (the time to read, to watch a course or to use a particular software).

    Cheers from London!
    … and Take Care of your Journey!

    – GPOB Elvis M

  3. says

    James, this is a brilliant post! The theory can be applied to so many aspects of life and I caution potenting clients in taking this route if they want a job done right, the first time. In my business of Interior Design, often homeowners are seeking out the ‘cheapest quote’ and lowest pricing on items. Many times clients hire my services only after they’ve gone the cheap route or tried to do a project by taking the contractors ‘free’ design advice which turned out horribly.

    I have recenlty reached out to a business coach to assist with my strategies. I see the value in their service to get me where I want to go more efficiently than I can on my own. I am psyched and happy to make this type of investment in me and my business. 🙂 thanks for sharing!

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