Too many startups try to focus on scaling the company very quickly. I believe that generating profit from day one is critical if you want to last for a long time. If you don’t get venture capital funding, you need to be conservative with your money.
I recently had the opportunity to interview Steve Tan, a successful eCommerce entrepreneur and the co-founder of eCommerce Elites Mastermind. Together with his brother Evan, Steve helps other eCommerce entrepreneurs find success through Facebook marketing and other traffic and conversion-boosting tactics.
What brought you to this specific career path? What happened, exactly?
Growing up, I was obsessed with video gaming. My brother and I would play games in 12-hour shifts, which was crazy. My mom was so disappointed in how we were spending our time.
As a single parent, she was working really hard to give us better opportunities and help us live well. One day, she asked us why we weren’t making better use of our time, and that served as a real wake up call.
After that, we started looking into ways to make money online. We started with basic internet marketing and eBay, which led to my involvement in a few startups. About two or three years ago, my brother and I were looking at Facebook and stumbled upon dropshipping. After more research, we decided to use our past experiences to start our own drop-shipping business.
What’s one of the most interesting things that’s happened to you since you started your career? Does anything specific come to mind?
We created our Facebook group to help people accomplish their eCommerce goals. Occasionally, we see people post testimonials or thank-you messages, and it makes us feel really happy to know that our information has helped someone change their life.
At one point, we decided to make what was essentially a scholarship for people in need who wanted to learn about eCommerce. Our winner was a young man from Mexico who came from a really poor family. With the scholarship, he was able to attend a training get-together of ours for free. Six months later, he sent us a thank you message saying he had managed to grow his eCommerce store’s revenue from less than $1,000 per month to almost $200,000 per month.
It changed his life, and now he was going to sponsor a scholarship for our next meetup because he knew it could change someone else’s life as well. That was an amazing and touching experience.
Can you share a story about the funniest mistake you made when you were first starting out? Can you share with us what you learned from that experience?
It doesn’t matter what you think; what’s important is what the consumer thinks. When my brother and I were just starting out, we always used our emotions to try and guess which product would sell well out on the open market.
Around a year ago, there was this cool-looking ‘black mask’ that went viral with buyers. We saw a similar product which was gold in color. Because of this, we viewed it as a more ‘luxurious’ offer. Naturally, we thought it would sell better than its black counterpart. However, after a week of testing things out, we didn’t sell a single one. Looking back, we learned what we think doesn’t matter all that much — what the consumer thinks is what really matters.
In short, in the world of eCommerce, always test out your products before committing to them. Also, never use your emotions when trying to determine whether or not there will be any kind of demand for what you’re hoping to sell. This wasn’t necessarily a ‘funny,’ experience, per se, but it’s a mistake both myself and my brother learned a great deal from.
What tips would you share with those in your industry to help them see success, as opposed to ‘burning out’ early?
Drop-shipping is a really good business model, but at the same time, it can be tough to start in — especially nowadays as it’s getting more competitive. Because it has relatively low startup costs, however, a lot of people will spend $100 and then wonder why they’re not having success.
You have to look at drop-shipping as a legitimate business model. How much capital would you need to start a traditional business? You can’t just spend $50 or $100. It requires effort and capital for testing products and running ads.
A lot of people start burning out because they assume drop-shipping will be an easier business model, and are surprised when things get hard. You need to hustle and keep researching. Continually launching and testing products powers the core business model of drop-shipping. With this foundation and the right tools, you’ll find success sooner or later.
You don’t have to rush things. Once you find one winning product, it makes all the difference. You’re always just one product away from success, so don’t give up.
Nobody is successful without some help along the way. In your life, who has helped you get to where you are? What sorts of things did they help you with?
Throughout my career, I’ve had my fair share of bad partners. I had a good friend who became my partner in a startup, but he didn’t have the right hustle mentality, so we had to part ways. I even had one business partner that scammed our startup out of its funding.
At the end of the day, I managed to find my best business partner in my brother Evan.
We’ve worked together on a lot of projects, but he’s also someone I trust. We had the same dreams and goals growing up. We both want to help our single mother be able to retire early and help her have a good life. This helps us keep each other hustling and giving our best efforts.
We even have the same interests, like cars and watches!
I’ve had my mentors and classes that helped me get started in the early part of my journey, but at this point, I have to credit a fair share of being able to build an eCommerce empire to my brother.
How have you used your success to bring widespread goodness to the world around you?
In addition to helping our Mastermind students, we also do some charity work on the side.
We donate to students in rural villages in inland China to help them get a university education. We have also gone to the Singapore Management University to share our stories to motivate the students and let them know what is possible. We want to prove to them that they can achieve success, as long as they hustle and stay motivated.
Do you have a favorite quote about a ‘life lesson’ that you refer to for help as an entrepreneur? If so, how has it helped you along the way?
I actually have a mural in my home office with my favorite quote, which is “If you don’t build your dream, someone will hire you to help build theirs.” Every day when Evan and I come into work, we look at this quote to stay motivated to continue hustling and pushing ourselves.
What are five things you wish someone had told you before you became an entrepreneur? Briefly, why did you choose each of these five things?
First, you need to understand that cash flow is king, and that scaling isn’t as simple as people sometimes try to make it sound. If you want to scale successfully, you have to learn how to manage your cash flow, including by using tools like PayPal and Stripe. Trying to run an 8-figure empire just to break even doesn’t make sense, and won’t work in the long run.
Second, entrepreneurship is hard. You need to be ready and willing to put in a lot of work. It’s not an easy path.
Third, too many startups try to focus on scaling the company very quickly. I believe that generating profit from day one is critical if you want to last for a long time. If you don’t get venture capital funding, you need to be conservative with your money.
Fourth, you have to learn to delegate. It seems like many entrepreneurs have trust issues and refuse to delegate to others. But this is crucial if you want your company to grow.
Finally, remember that failure is just part of the journey. It’s very common to face failure throughout your entrepreneurial career. Don’t give up and keep persevering.
I think if I’d known these things earlier, I would have been better prepared to respond to some of the challenges that came my way, and possibly avoided some of my earlier failures. Still, I’m grateful for what I’ve learned because of those experiences.
You’re an influential person. if you could start a movement of some sort to bring about a great deal of good in the world, what would it focus on?
If I had unlimited resources, I would create a free eCommerce school where I could teach people all the necessary skills to get started in eCommerce.
Basically, something where I could go around the world to at least teach people the basics of eCommerce marketing so they could get started in this business model. It’s a very lucrative and fluid market, and the more people who learn about it, the more who can benefit from learning to sell so they can enjoy a better life.
Lastly, how can our readers connect with you on social media?
I do get a ton of messages, though, so try to get straight to the question so I can better respond to you. If you don’t get ahold of me there, I’m available through email at [email protected]. You can always join our Facebook group to learn more!