Monthly Archives: September 2009

Insight On Starting And Growing Your Own Business by Host Gator CEO Brent Oxley

Brent Oxley is the CEO and founder of Host Gator. Host Gator is a website and blog hosting company currently located in Texas. I read with fascination his account of starting this business and growing it to 200,000 customers posted to his blog when they reached the milestone of 200,000 customers.  Brent is less than 30 years old and describes in detail what he has experienced and endured in growing to the level of success he is experiencing now.

I am a customer and have been very happy with this company for over four years. I did not know this story and do not know Brent personally.  However, I can relate to some of his experiences as I started an Internet Service Provider company in 1995.  Technology was not as advanced as it is today and I found operating the equipment and technical parts of that business were not where I wanted to spend my time.  My focus continues to be on how to use the tools of the Internet to help build business revenue and profits. I am happy Brent loves what he does because his company does an excellent job and I am delighted to be able to rely on the services of Host Gator.

I think that often time, people do not have an appreciation for some of the difficulties entrepreneurs face in growing a business. Brent describes his very well and you will have a good sense of his experiences. However, he and many others work through those challenges with passion for what they are doing  which further fuels profitable progress.

This is a reality check for those thinking about starting their own business or taking an existing one to the next level.  My advice for anyone looking to go into business or who is already there includes:

  1. Pursue the business because you are passionate about what you do and not because there is an opportunity to make money.  When money is the primary factor, being unhappy is often the result.
  2. Know the critical success factors for your business and don’t compromise on the quality of people needed for those areas.  For Host Gator, those factors are system reliability and customer support. You will notice how Brent focuses on those two areas.
  3. Know when to bring in more experienced leadership than you have.  Look at eBay and Google as an example.  In both cases,  executive leadership was brought into the business. Revenue and Profits grew exponentially.

Enjoy Brent’s  story. Click Here for the original post which is presented in  its entirety below

Steve Pohlit

Contact Information

Buseiness Consulting, Executive Coaching
International Business Resources

Social Media Services
New Digital Media, Inc.

727-587-7871
Email

HostGator recently reached 200,000 active customers and we are on pace to break 300,000 within a year.

I remember when I’d be out celebrating if HostGator managed to get two signups in a week. Now, we’re seeing thousands of signups a week. Back in the day, my celebrating consisted of nothing more than dropping the Ramen noodles or the tuna can I had in my hands and grabbing some sushi for an hour before scrambling back to work. At the time, I was a poor college student who invested every penny I had back into the business I was building.

The HostGator.com domain was registered on October 10, 2002 and here are some statistics about how many active customers we’ve had at a few points since then.

  • 2/1/2003: 112 active customers
  • 2/1/2004: 1,031 active customers
  • 2/1/2005: 6,892 active customers
  • 2/1/2006: 21,434 active customers
  • 2/1/2007: 50,213 active customers
  • 2/1/2008: 92,752 active customers
  • 2/1/2009: 157,432 active customers
  • Today: 200,000+

How HostGator Came To Be:

I’ve been an entrepreneur since I was a kid. In sixth grade, I sold candy at school and had all the kids in my neighborhood working for me. When I was 14, my cousins and I had a business where we sold watermelons from a truck on the side of a road. The deal we offered was simple, but effective: “2 for $5.”

It wasn’t until I was a sophomore in high school that I got hooked on trying to make money on the Internet. What sucked me in was the paid to surf programs such as AllAdvantage, Bepaid.com, Cashfiesta, and the like. These companies claimed they would pay you to surf the Internet while looking at ads. I created my first website on a service much like GeoCities and was able to generate over 50,000 referrals between all the programs I was enrolled in. One by one, I learned that all of the programs were a scam. I made $65 when I was entitled to over a million.

After the paid to surf venture failed, I decided to create real web sites and sell my own advertising inventory. The network that I created was called The Freak Network and consisted of scfreak.com, dfreak.com, and wcfreak.com, all of which were named after best selling Blizzard Entertainment games (Starcraft, Diablo, and Warcraft, respectively).

My network was making me about $40 a day, which was impressive given that all of my pimple covered friends had to get real jobs and make less money. Everything was going great until the .com bubble bursted and my advertisers began to cheat me out of money. I was left with no choice but to find alternative sources of income and that’s when I had the epiphany to start selling web hosting on the side. My network of websites was receiving tens of thousands of page views per day and I already had the servers, so selling web hosting seemed like the perfect plan. Freakwebhosting.com was born. My plan was to use the traffic from my gaming websites to gain customers.

I built Freak Web Hosting to just shy of a hundred customers that consisted mostly of gaming sites. The problem was that I wasn’t a system administrator and that I wasn’t that technical. This resulted in poor security which lead to hackings, horrible uptime, and a never ending series of technical issues that kept me from running a successful business. I hated being a webhost at the time! I was able to get the business but no matter how hard I searched I couldn’t find someone to take care of the technical issues at a price I could afford.

I spent years trying to make my network a viable business and another year trying to get my web hosting venture running smoothly . The final straw was when the Data Center claimed that my server was “compromised and outgoing malicious traffic.” To alleviate this problem, they ordered OS reload after reload, which drove me to a point just short of insanity and a state in which I felt life was over. (In hindsight, I believe the datacenter lied to me about the malicious traffic in order to get me to leave due to the amount bandwidth my sites were using. The deal they gave me at the time was too good to be true and that’s exactly what it ended up being.)

I could have kept on fighting, but it would have been a futile effort. I was left with no choice but to scale down operations. I did the right thing by refunding everyone’s last month of hosting and even refunded those that prepaid for a year in advance. At the time there were three annual customers that I didn’t have enough money to repay, so I contacted them to let them know my intentions and eventually paid them back a few months later.

By the time The Freak Network and Freak Web Hosting failed, high school was coming to an end. I didn’t have much time before I would have to decide what to do with my life. I felt like a complete failure and had nothing to show for all my years of work.

I wanted to be a success and make some type of difference in the world and I felt as if I couldn’t accomplish this by going to college. I was very close to joining the army and even went to see a recruiter. I believed that if I joined the army, I’d have purpose in my life and be able to make some type of difference. Just days before enlisting, my dad talked me out of joining the army and helped me get into Florida Atlantic University in Boca Raton, Florida.

I spent a few months living on campus and attending classes without deviating too much from the life of a regular student. That’s when an old friend contacted me telling me that he started a server company. He knew that if we went into business together I’d have no problem getting the customers. He begged me for a week to get back into hosting and eventually convinced me to partner with him and try hosting again. After failing the first time around, I was against the idea and didn’t want to try again unless I was confident I had someone with technical abilities to keep the servers up and running.

The deal we came to orally was that I’d run my own business and I’d give him half the proceeds for keeping the servers secure and up and running. I quickly revived the old Freakwebhosting.com brand and reached out to all my old customers. I managed to convince a majority of them to sign up very quickly and within days, I was once again a web host and once again in the hosting industry.

It only took a couple of months for reality to set in . Servers began having multi-hour outages on a daily basis as a result of the datacenter going offline. I was bringing the business in while my partner was failing to uphold his end of the bargain. The servers weren’t up and running; they were failing.

I decided to break the partnership and venture off on my own. I ended up purchasing a few servers from Dedicatednow.com and managed to find a system administrator who would help me as I needed and bill me by the hour. The combination of the new Data Center and system administrator made Freak Web Hosting more stable than ever.

With things running so well and the old Freak Website Network being dead, I knew the company needed a new design and a new name. I searched for days and tried hundreds of domain name combinations before I narrowed it down to two names: HostGator and GatorHost. I was torn on which domain to choose. I didn’t know which one sounded better and couldn’t afford both domain names. HostGator may sound like a much better name now, but at the time and without all of our branding, they both sounded the same.

Business was booming and my freshman year of college was coming to an end. By this time, every second of my life was spent in class, doing homework, or taking chats and answering emails on the computer.

I was a 24/7 one-man operation. I was being woken up numerous times a night with phone calls and there wasn’t a single class I would make it through without having to leave at least a few times to take a business call. I knew I was on path to be making more than the average college graduate in about six months. I also knew it would have been impossible to finish another year of college while running HostGator, so I decided to drop out of school and follow my dream of growing HostGator into the world’s largest hosting company.

Understandably, my family and friends were all very much against my decision to dropout. I had many businesses that failed to pan out and the chances of HostGator succeeding were slim. In the end, everyone expressed their thoughts strongly, but supported me in my decision. To me, it was a no-brainer. If things didn’t work out, I’d just go back to school and be miserable. If they worked out, I’d be pursuing my dream.

Things continued to go well for the Gator at the expense of living life, having friends, and never being able to leave the computer. Within minutes of leaving the computer there would always be some type of emergency with a service going offline that would require a restart and I’d have to run back to my computer. More times than not, I’d make it half way to my wherever I was going before getting a phone call or an alert and being forced to turn back to resolve the issue. This was before the iPhone, smartphones, air cards, or any other type of mobile tool. What amazed me is the fact that I was not that technical, but was still able to help most of my customers by simply taking their question and applying common sense or finding a work around.

When HostGator had just started, I hated resellers because they required a large amount of relatively technical service. What’s ironic is that as we grew, I saw how easy it was to obtain reseller customers. Before long, obtaining reseller customers is where most of my focus and advertising money went. Ideal timing allowed us to fill the reseller niche while the competition focused primarily on shared hosting. Today, shared hosting is the source of most of our new business, but we continue to remain the worlds’ largest reseller hosting company.

If a major issue ever came up, I’d be helpless when it came to actually solving the problem. I was at the mercy of an hourly system administrator who usually had something more important to do than fix my servers. In the early days, HostGator was inadequately prepared for drives failures and similar large-scale issues. When one happened, there would usually be data loss and days of little to no sleep while I helped customers recover. I continued life in my apartment prison for another year before the company grew beyond what I could handle myself and I hired my first full time employee, Ben Welch.

Ben would arrive at my house while I was sleeping and immediately get to work taking calls, chats, and tickets. When I woke up, I’d head over to bedroom and get to work with him. At approximately the same time, I hired an Indian outsourced support company. The support volume was more than Ben and me could handle alone and it was impossible for us to man all of the stations all of the time.

I don’t believe in outsourcing, but at that point, outsourcing was the only way I could have 24/7 coverage of email and chat support that I could afford.

In hindsight, outsourcing was a big mistake. Choosing to outsource our supported resulted in the loss of customers, a damaged reputation, and low caliber support. As soon as we could afford an office, we rented a 1,600 square foot office in Boca Raton, Florida and began replacing our outsourced employees with in-house employees. We learned our lesson with outsourcing and have had 100% in-house support for several years now. There’s absolutely no chance of us switching to outsourced support in the future – it just isn’t worth whatever we’d save in the short run.

When we first moved into our first office, I thought that it was overkill and I wasn’t sure how (or if) we’d ever fill it. In no time, sales and growth caught fire. We had people working in closets, hallways, and I had to share my office with another employee. The office wasn’t that bad of a place, but there was one major problem. We had a single stall co-ed restroom for over 24 employees to share and nobody to clean it. If you had to go, you’d usually end up holding it or driving home.

I continued to wake up numerous times a night to take support calls and contribute to our service and support as much as possible. This took a toll on me, though. At the ripe old age of 22, I began to develop a very serious case of carpel tunnel syndrome. It slowly progressed until I was at the point where tapping any finger on either hand would feel like needles piercing me to the bone. I ended up trying a few alternatives to typing, including holding pencils in the palms of my fists and hiring someone to type and move the mouse for me. Typing with pencils only helped so much and hiring someone to communicate what to do ended up being a nightmare.

Eventually, the pain worsened to the point where it affected everything I did. If I went to a movie, all I could think about was my hands hurting. If I drove home, the pain would be so intolerable that I would have to alternate sitting on my hands so they would fall sleep to allow the pain to temporarily go away. Technology began to improve and I soon learned of Dragon Naturally Speaking speech recognition software. This was a lifesaver for me and while it wasn’t perfect, it did allow me to continue to perform my duties, just less effectively. I ended up using Dragon for a few years before my hands recovered to a point where I’m no longer in pain and I’m able to type without any discomfort. I’m sure if my old lack of sleep and constant typing routine came back, my problems would as well.

Eventually, we ran out of closets in our Boca Raton office and had to find a new location. We were also severely understaffed and couldn’t find the people we needed to keep up with our rapid growth. Boca Raton is where people go to retire not find a job. It’s so bad that the locals would always joke that Boca was “Heaven’s waiting room.”

We initially searched for office space in South Florida, but found the prices to be astronomical for the size we needed to maintain growth. We began looking in Dallas, Texas for a new office and somehow ended up looking in Houston. Soon after, we found and purchased the 30,000 square feet office building that we’re currently located in. The office was perfect for us since 16,000 square feet was available for use and the rest was leased out. We currently occupy around 18,000 square feet of the building and I anticipate that we’ll be filling the rest in a little over a year .

When we first moved into the new building, me and a few other employees took up residency throughout the building. There was very few employees at first and nothing but empty space. Many people that I met had no idea what web hosting was and were convinced that I was a drug dealer. They believed this because I was so young, successful, and living in an empty building with a bunch of young adults in what resembled a frat house. It also didn’t help at the time I had just gotten back from Brazil to open HostGator Brazil.

The Future of HostGator:

I still haven’t reached my goal of HostGator becoming the world’s largest hosting company, but as one of the world’s largest and with how well things have been going, I can definitely see it happening within the next eight years. In order to achieve this, we’ll need to go more mainstream. This includes launching a brand to compete with GoDaddy, more billboards, starting TV commercials, and hiring many, many more high quality employees to continue supporting our customers.

HostGator has been a real blessing in my life and I couldn’t have gotten us to where we are today alone. I owe much of HostGator’s success to our customers as well as to each and every employee who has put their heart and sweat into this company. If it weren’t for all of you, I would most likely have to return to college. Ahhhhhhhhhhhhhh!

Thank you!

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How Can This Be Good: Two More Banks Fail, Bankruptcies At New Highs, Commercial Loans Ready To Implode

If you have followed this blog you know I am a fan of Bill Bartmann. He is a rags to billionaire riches  story and most of his wealth came during an economic climate similar but actually less serious than what we are facing today.  I follow Bill because he deals in reality and looks for the opportunity in what other see as a disaster.

This email I received from highlights some startling fact about our economy.  Personally I some direct experience with our financial institution industry and if anything Bill may be understating the pending failures.  As for the opportunity Bill suggests, that is up to you. I am not an affiliate, I am not paid to publish this on my blog, I make no money from sharing this with you.  I feel Bill is on the mark and come to your own conclusions.

I have been on several of Bill’s calls and I have studied his book Bailout Riches which I highly recommend if you have an interest in the details of how this works.  If you are intrigued you now have the information on the next steps.

Steve Pohlit

Contact Information

Buseiness Consulting, Executive Coaching
International Business Resources

Social Media Services
New Digital Media, Inc.

727-587-7871
Email

On Friday, FDIC shut down two more banks - which will have billions in losses.

The bank failure total for the year is now 95 and includes three of the largest and most troubled — Guaranty Bank in Austin, Colonial Bank in Birmingham and Corus in Chicago.

We project the number will top 1,000 over the next year and a half.   The majority of the banks that will fail are Community Banks and Regional Banks where the impact will devastate entire communities.  The FDIC is running  out of money and will soon have to tap taxpayers – only the second time in the 75 year history of the FDIC that it had to do so.

Personal bankruptcies will hit a record 1.4 million this year.

Business bankruptcies are 250% over their previous high – and rising.

Unemployment is at 9.7 – heading for 10%   (Department of Labor says real unemployment rate is 16%).

Credit Card charge-offs are at 10.5% and Moody’s predicts they will go to 12%.

Mortgage foreclosures and “walk-aways” continue at record pace.

Any discussion of the Recession ending and the recovery beginning are based on wishful thinking, while ignoring the brutal facts.

The Commercial Real Estate market is about to implode the same way “sub-prime residential real estate” did two years ago. The economic impact of this implosion will compound every category mentioned above which will result in increased bank failures, increase personal and business bankruptcies, higher unemployment, higher credit card and mortgage default.

Sounds terrible, doesn’t it?

OPPORTUNITYWell, it is terrible – but it is also some of the best news you could ask to hear!

Why?  Because the last time I saw this environment, I made $5 billion just picking up the pieces of all those credit defaults and failed banks and by helping good banks dispose of their bad loans.

Now, a $5 billion net worth may sound unbelievable.  I assure you it was real and I was not the only person who made a lot of money helping all those consumers put their lives back together and helping the government and the banks solve those problems.  That is how big the opportunity was 20 years ago.

Guess what?  We are back in that same situation again today!  Banks are failing left and right.  Bad loans are everywhere you look.  The US Treasury and the FDIC are looking for people like you and me to help solve this problem.  Just this past week the FDIC closed on the very first tranaction under the Legacy Loan Program.  The Legacy Loan Program allows a generous leverage that magnifies the return for the Investor.
This first transaction under the Legacy Loan Program was a pool of residential real estate loans.  Now, I have no interest in real estate and neither should you.  But, first comes the real estate and then comes everything else and that is where the great opportunities are.
Those of us who participate and take advantage of this program could potentially make millions of dollars. T

he Legacy Loan Program not only makes a tremendous amount of loans available for purchase at a steep discount to true value, they it provides a government funding source.

The Legacy Loan Program is not the end of the good news and the great opportunities.  The market is rapidly filling with charged off loans available for purchase at very steep discount from banks that have not failed — banks like Chase, US Bank, Bank of America, Citibank, Wells Fargo and all the other names you have known for years.

Here is your chance to get a piece of the “Bailout!”

Here is your chance to take advantage of what will be a “once in a lifetime opportunity.”

Finally, a Bailout Plan that is aimed at all of us on “Main Street” instead of those fat cats on “Wall Street.”

It gets even better than that.  I am offering my students a chance to become a full-fledged business partner with me in this industry.   Bill Bartmann

Join me and Larry Genkin, Creator of the Thought Leadership Marketing Methodology, as I explain how we (you and me) can take advantage of this wonderful opportunity.
This one-hour teleseminar is scheduled for 7:00 pm – Central (8:00 pm Eastern, 6:00 pm Mountain, 5:00 pm Pacific) on Wednesday, September 23, 2009.

Click Here to register for this teleseminar.

Please

Click Here to convert the call to your local time zone.

See you then,

Signature

Bill Bartmann

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How To Fix The WordPress Worm

I dated this post since apparently the worm morphs as technology develops to stop it’s attack. So what is true for today may not be true for tomorrow. Right: the worm is on the loose. I noticed the alerts two days ago and began checking my blogs. This one was already infiltrated.

You can tell if you are diseased because the links don’t work and there is an administrator for your blog that you never added. You can tell when you check in your admin panel and see there is number greater than the admins you have authorized. The article at this link Click Here was helpful to me confirming the problem but I could not duplicate the fix the author was suggestion.

I found this article Click Here and actually it was the key for the solution for me. I did not seem to have the bad permalink code mentioned in article one but the links were a problem. I soon fixed those by defining my original permalink structure and my links started to work.

I called a tech friend of mine and he came over and we ran registry cleanup software and malicious spyware detector programs. He said he nuked all that was there and my system was clear to go. Well admin no 2 was still there, we could see him and part of his name was Obama. I am making not blaming the current person who was elected as President at all. I am just reporting on a portion of the name used by this worm.

So the brain trust problem solvers were stuck. Later I remembered article two above and said I am going to test a reinstall. Now that is totally scary since you are talking about starting with a clean slate – a really clean slate. My slate was never that clean after having been to the confessional as a child many times at the encouragement of my mother “you will go to confession young man or you will not be eating dinner in this house tonight” There were some appealing parts to my mom’s threats.

I selected a throw away blog. One that was a good idea at the time but lost appeal. Kinda like someone you meet at 2AM in the morning. With that blog I tested the nuke and rebuild approach. It worked.

Key Points:

You must use the WordPress backup and export to file features

I verified this worked by creating a duplicate first before nuking the original. You can see the duplicate at http://stevepohlit.com/stevereports.

When you export the content here is what is not included  and so you need to have a record of this :

your links

you will find the first post and a duplicate about page is created. You will see them if you look and delete them

If you are using widgets like I am here you need to copy the code for the ones you are using. I mean the ones where you are using ads, facebook widget, twitter widget, rss feed widget etc.

Notice at http://stevepohlit.com/stevereports that there is one widget that is not functional. This is the Google Friend Connect Widget which is site specific. I did not correct this on the duplicate.

Sharing with all my readers the energy of peace, happiness and abundance

Steve Pohlit

Contact Information

Buseiness Consulting, Executive Coaching
International Business Resources

Social Media Services
New Digital Media, Inc.

727-587-7871
Email

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About: Steve Pohlit is a CPA,MBA and has been the CFO of several major domestic and international companies.  Steve is business owner and an expert business consultant, direct response and social media marketing  and social networking security expert . Steve is  focused on helping companies improve their business performance. All articles published by Steve unless specifically restricted may be freely published with this resource information.



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Comments On The WSJ August Retail Sales

The Headline Reads: Retailers Report Weak Sales For August (Click For The Story) Then highlight is:

“Industrywide, same-store sales fell for a 12th straight month — highlighting the woes retailers have been under as consumer spending continues to decline.”

Then there is discussion as to what will happen this holiday season as well as the impact of the clunker program. This is followed by reports of what key public companies in the retail industry reported. Remember there is a lot that is not reported. Also remember, economic recovery is driven by consumer spending and there is little evidence that is strengthening.

The point made that I commented on was that going forward the monthly same store comparisons will look better because you are comparing against increasingly weak numbers from last year as retailers tanked in the fall of 2008. Here is what I wrote:

The comparison may show less dramatic declines and even a greater number of positive percentages when current year sales are compared against months last year when retailers began to experience sharp declines. Those may be feel good metrics. However, the key is what are the volumes and margins that are planned in connection with an acceptable profit plan and how are actual revenue and profits doing against that?

Typically that information is a bit more difficult to extract. The well run retailers have a profit plan by location that is based on category proformas. The key is to be profitable at each location and in each category within that location. I still see very little advancement in the use of direct response marketing and social media marketing. Tools and technology that have been readily available and proven to work for quite some time.

There is a lot of the “same ol same ol” and that is not going to work in an economic climate likely to be very soft for quite awhile.

Steve Pohlit
http://newdigitalmediainc.com
http://stevepohlit.com

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