Develop a side-hustle, or hobby-job, while still having a W2 job so that when you quit your job you have something already going to get into.
Mike Scanlin has been trading covered calls for 37 years, and has been CEO of Born To Sell since 2009.
His stock broker father taught him as a teenager that selling options was a better strategy than buying them. He is an active investor and has the majority of his own money invested in covered calls. He is a frequent writer and speaker on the subject of covered calls.
Prior to running Born To Sell, Mike had 3 distinct careers: software engineering, investment banking, and venture capital.
As a software engineer, Mike spent 12 years at several Silicon Valley startups. Two of them went public on NASDAQ: Storm Technology (1994) and General Magic (1997).
After that Mike switched to investment banking at Garage.com (now Garage Technology Ventures) where he helped early stage startups raise money from angel investors and VCs. During his 4 years at Garage, Mike read thousands of business plans and was part of the team that helped over 100 startups raise over $300M.
Mike switched from investment banking to venture capital in 2002. He worked at two billion dollar VC funds, Sierra Ventures and Battery Ventures, as a direct investor — putting $86M of LP money into high tech startups and serving on their Board of Directors. He is currently a Venture Partner at Ottawa’s top venture capital firm, Mistral Venture Partners.
His passion has always been covered calls. In 2009 he became a full-time entrepreneur and started Born To Sell. The goal was (and is) to provide best-of-breed covered call software to self-directed covered call investors.
Where did the idea for Born to Sell come from?
My site is about covered call investing. I had been a covered call investor for 25 years but there were no good tools to help me out. Using an Excel spreadsheet was a poor substitute for what should have been a dynamic web site that imported live quote data, earnings release dates, dividend dates, etc. So I took 18 months to develop the tool that I wanted to use for my own personal investing.
The name, Born To Sell, has meaning to our customers, who are option sellers. They sell options to other people (the buyers of the options).
What does your typical day look like and how do you make it productive?
I live on the west coast where the stock market opens at 6:30am. So I’m usually at my [home office] desk by 6am so that I can read the news a bit before the market opens. I trade a little bit each day but that’s not the main use of my time. My site is self-service so it mostly runs itself. I do have a few customer support emails to respond to each day. But most of my day is spent looking for additional web sites to buy (I’m developing a portfolio of income producing web sites).
How do you bring ideas to life?
I started by hiring 1 freelancer. He was in Singapore and was a programmer. I sent him a PowerPoint mock-up of how I wanted one of the features on the site to work (user enters data on a form, the site looks up some values in a database, does some math, and the presents the results to the user). It was simple but it convinced me that the technology for what I wanted was available, I just needed to make is super pretty and super useful for the average covered call investor.
I love freelancers. You can post a job on UpWork one day, have a dozen credible people wanting to do the work the next day, and have the work completed within a few days (if it’s a small project). Instant response. You can prototype things very quickly.
What’s one trend that excites you?
The Internet at large enables tons of people like me to be self-employed. We can create revenue-producing web sites with various business models (ad-supported, affiliate-supported, SaaS, eCommerce, etc). It’s possible to develop multiple, non-correlated passive income streams.
What is one habit of yours that makes you more productive as an entrepreneur?
I’m an OCD workaholic. High degree of attention to detail, love what I do, and work until the job is complete. I ignore things that aren’t pertinent to the task at hand. I can focus on a single task for long periods of time (key requirement for good programmers).
What advice would you give your younger self?
Give up the W2 job sooner; start your self-employment career sooner. Maybe develop a side-hustle, or hobby-job, while still having a W2 job so that when you quit your job you have something already going to get into. In my case I went about 18 months without an income and that was a bit stressful. If I could do it again I would develop an income site during nights and weekends while I still had a day job.
Tell us something that’s true that almost nobody agrees with you on.
In life, you make your own luck. There’s very little substitute for hard work.
As an entrepreneur, what is the one thing you do over and over and recommend everyone else do?
Experiment. You may think you know what the market wants but until you try it with some actual customers (or prospects) you won’t know. Many times that one thing you didn’t think was a big deal becomes the most important part of what you’re doing. The market (and customers) WILL surprise you in ways you didn’t expect.
What is one strategy that has helped you grow your business?
Affiliate marketing. Rather than spend all your money on direct advertising, get other people to do it for you and then cut them in on the revenue if they produce. Today we have over 1000 affiliates who bring traffic to our site. If that traffic converts to revenue then the referring affiliate gets a piece.
What is one failure you had as an entrepreneur, and how did you overcome it?
After 18 months of development, which included integrating an automatic subscription billing component, we launched our service. Then, 3 days later the bank called and said “we’re cancelling your merchant account”. I asked why and they said “because you’re selling investment services online and we don’t do that”. They were wrong on several fronts but the short version of the story is that we couldn’t charge any of our customers for weeks until we wrote more code to integrated with another payment processor. Right when our carefully laid marketing plans were peaking, we couldn’t onboard any new customers. Ugh. We ended up offering an extended free trial for anyone who signed up during that time. About a month later we were able to charge customers again.
What is one business idea that you’re willing to give away to our readers?
Build or buy a portfolio of income producing web sites. They can (and should be) on a variety of topics. For example, one on running shoes, one on gardening, one on dating, on on best BBQs to buy, etc. Get about 10 of them. Then build back links to increase their organic search rankings (which, in turn, increases the amount of free traffic you get). Monetize the sites with Google AdSense (where Google pays you to put their ads on your sites) and affiliate programs (Amazon is most common, but there are others). Once you get this portfolio humming (will take a year or two) you can sell it for 30x monthly profit. So if you’re bringing in $5K/month profit you can sell it for $150K.
What is the best $100 you recently spent? What and why?
Flowers for my wife. Happy wife = happy life.
What is the one book that you recommend our community should read and why?
Book title “Traction” by Gino Wickman.
What is your favorite quote?
“You can have anything you want if you give enough other people what they want.” Zig Ziglar
Key learnings:
- Find a product/service need that you personally need or would pay to use
- Test your idea on prospective customers before spending a year to build it
- Work your ass off
Connect:
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Carlyn runs the day-to-day publishing operation here at ideamensch and interacts with our awesome customers and entrepreneurs. She is likely editing this with a cat on her lap.