Fred is a big time Amazon seller with a Facebook group of over 700 Amazon sellers.
“In Episode 20 we are interviewing a guest, Connor Gillivan.
Fred: Hi y’all! What’s up? What’s up? Welcome. Welcome back to the E-business Online podcast. So glad that you are here. We are at episode 20, 2-0, episode 20. I can’t believe it. Here we are, we are on the train rolling down the track. I don’t know about you, but I’m sitting down here on St. Simon’s Island, Georgia and it is gorgeous. And when I say gorgeous I mean gorgeous! So I don’t know, you know, we keep talking about it in the EBO forums of Facebook and around of having a meet up. We need to do it soon. We need to do it real soon before it gets too hot down here. It gets too hot down here because it can get hot real hot, real quick – hot and humid. But right now, it is outstanding it is beautiful; life is crazy in our world of e-business and e-commerce.
Just this week, for me personally, two different Private Label products that have gone on to market, and so, I’m kind of tired a little bit. You know, I’m like a little worn out. I’ve got four kids; my oldest kid is a sophomore at Glenn Academy here in Brunswick Georgia. He’s finishing up finals and my other kids are doing finals. He had two AP tests back-to-back today, which was brutal. So I’m feeling pretty fatigued but this person has been studying and studying for these tests. He just finished that up today. So I can’t complain because he’s probably more fatigued than I am.
But were so glad you guys are on the show. I hope things are going well for you. I hope ebusiness is cranking for you whether you are a veteran, whether you’re doing this for years and years and years. Or whether you’re just getting started or maybe you’re just thinking about putting your toe in the water. You’re in the right place. We like to talk about everything about ebusiness here; from drop shipping to private labeling, to wholesale, flipping products on Amazon, Jet, Wal-Mart, E-bay, Newegg, Sear’s, Etsy, Wish, and the list goes on and on. Selling on your Shopify store, your Big commerce store, it goes on and on. You’re in the right place.
I’m excited about our show today. We have a special guest. Welcome to the show – my guest, my friend, is Connor Gillivan. Connor, welcome to the show, man.
Connor: Fine, thanks for having me. I’m pumped to chat today; I think we’ll be having an awesome conversation.
Fred: Yeah, I’m looking forward to it. I’m talking about how gorgeous the weather is here on St. Simon’s, Georgia and you’re down in Orlando. So you’re what, maybe three and a half hours depending on traffic, south of me. There’s always something that stops there, on the interstate, in between Winter Park in Orlando, that isn’t friendly to me no matter when I go through. You probably experienced that, right?
Connor: Oh yeah. A lot of traffic in central Florida, but as you said, the weather is gorgeous right now, pretty perfect before we get into the hot summer.
Fred: Yeah, so how far away are you from Mickey Mouse?
Connor: I am about 45 minutes to an hour depending on traffic on I-4 in downtown Orlando.
Fred: Oh you’re in the middle of it all, yeah. Well very cool, man. Well listen, I’m so glad you’re in the show today. This is going to be a great show and I can’t wait to get into the nuts and bolts of what we’re going to talk about. It’s a real treat to have you. Just 27 years old, right?
Connor: Yes, absolutely.
Fred: 27 years young, we should say, and crushing it out there. He started his own Amazon business and has done over $20 million. You heard that right $20 million on Amazon. I would call a success right away. That has just really taught Connor about ecommerce and a lot of things that we’ve talked about including getting some help on outsourcing that we just talked about on Episode 19. So I want to encourage everybody that’s listening, if you have haven’t heard Episode 19 to make sure to back up and check that out at e-businessonline.com/episode19.
I talked a little bit about why you would want to hire a virtual assistant or outsource. Connor is going to get into some of that, but first, Connor, just jump in and give us a little bit of your story, your biography. How’d you get started in this and let’s hear a little bit of what is going on with you.
Connor: Yeah, I would love to. So, down to the core of how I got to entrepreneurship it really came down to that entrepreneurial dilemma, right? So, you identify the problem and you try to find a solution – it’s a problem that a lot of entrepreneurs run into. When I was in college I was a sophomore attending Quinnipiac University, which is a small school up in Connecticut. My current business partner today as well, his name is Nathan Hirsch. We saw a problem on campus where students were purchasing textbooks from the bookstore and at the end of the semester. They’re bringing them back to sell them because they didn’t need them any longer. What they found was they would buy the books for $200 and then the bookstore would offer them maybe $10.
So we saw this issue, we saw a lot of our friends frustrated. In college you’re to get any extra bucks to have little bit more fun. And so, we started offering our friends and other students on campus higher prices than what the bookstore was offering. And that’s what led us to start selling on Amazon. That was 2009 – 2010, the book marketplace for Amazon was absolutely booming and they were just starting to expand into other product categories as well. And so that’s how I really got into Amazon at first.
We were buying the textbooks, we’re selling them, listing them, adjusting the prices, pick packing them, and shipping them to the customers, and really starting to understand the intricacies of selling on Amazon. Because I’m sure, as you know, and other people are listening now, Amazon has pretty high expectations for their sellers – it’s not a cakewalk. You have to live up to their metrics and everything that goes into it.
And so we went through this process for about a year selling textbooks and being pretty successful with it. Then we started to think about the idea of, “Hey, is there any way that we could never touch the product”? Because we’re sick if pick-packing and shipping the books, holding them in our dorm rooms and our college houses. And so we started to do some research and found this whole idea of drop shipping.
That was when we started to get into that whole business model. So we started reaching out to manufacturers and suppliers around the country looking to see if any of them would be willing to allow us to represent and sell their products through our Amazon store. And so that process again was pretty long, a lot of learning along the way, figuring out what these people wanted, and how suppliers can work with sellers on Amazon. It was something kind of new to them as we’re getting started.
We just slowly expanded into different product categories, building the drop ship relationship. That’s what really what allowed us to take the business forward and get it to that point where we were representing and selling over 500,000 products on the marketplace. And we were able to get to that $20 million in total accumulative sales in the years that we were running the business.
So that’s a little bit of intro to my story. We hired a lot of people along the way, and that’s what kind of led to FreeeUp and I’m sure we’ll talk a little bit more about that. But I’ll cut there and we can talk a little bit about the whole Amazon experience and then get into FreeeUp and outsourcing once we’ve talked about Amazon.
Fred: Yeah, totally. A few questions I had. So you’re at the university, what field were you studying?
Connor: Sure, I was studying Economics and Math, and the economics program was within the business school. So I took a lot of business and entrepreneurship classes as well.
Fred: Oh, that’s nice. That’s one of the schools that would offer that. And more and more schools are offering that type of thing now, which is really good. So did you bother – you were making 20 million bucks on Amazon, right? We know that doesn’t mean that you made $20 million dollars. We all know that, but you were really succeeding there, so do you finish out college? Or do you just say, “Hey we’re on to something, who needs this?” and move on.
Connor: Yes, good question. I had two co-founders on this first business, which is, the name of the business is Portlight. And the three of us still work on it today and we all did finish out college. When we were up in college, we weren’t reaching that $20 million, but were making a good amount of chunk there that we were able to take personally and start investing and also and put back into the business and keep it growing. It was really the couple of years after we all graduated that the business really blew up and we’re starting to hit those really high revenues.
Fred: Yeah, beautiful, beautiful. So, couple of questions I had, just hearing about your story, which was fascinating, so any of you college students that are listening, wow, what hope, you know. I want to take you back to the books. I can feel that pain, man. Two hundred bucks for textbooks and they want to give you ten bucks for it. Then they’re going to resell it used, in the bookstore for a hundred and eighty.
So when you started doing that – I’m just going to this process, trying to put myself in your shoes. And students come to you and say, “I’ve got this American government textbook that I want to get rid of. Did you do it on consignment or did you pay upfront for it. And if you paid upfront for it, how did you know the confidence, like we can pay for this because we know – you didn’t have extensions and things like that back then to do a lot of product research to know if something would actually sell or not. So how did you walk through that?
Connor: Yeah, so that’s a great question. What we did was if someone was interested in selling the textbooks to us because they heard it through the grapevine on campus that we’re offering better prices, we would take the ISBN and push it into Amazon’s search bar and see the book that came up, or search its title. We would find what the average price was, that it was being sold for in Amazon. And based off of that, we could run some quick math to figure out, hey what could we buy this at to reach a certain gross profit margin or just make some money off of selling the book.
Fred: Right, but you went on and just prepaid for the book. You had no guarantee that the book you just purchased, you would be able to flip it.
Connor: Right, so we paid upfront for the books, we just kind of hoped that we would be able to sell it.
Fred: Obviously, you did good there. Back in that time, I guess, there wasn’t so much talk about BSR or sales ranking, all these extensions and things you could use to say that if a book is in used condition and this BSR, we know it’s going to sell x number of times. That’s really cool.
Now, you started moving into drop shipping, which is really cool because you and I have a lot in common in that. You know at one point, I guarantee we had, I think I had over a million SKU in my big Seller Central account. But they’re not all active; they’re not all active at all. But half a million SKUs, that’s definitely way up there and we’ve definitely been there before. I’ve actually cut my catalog down a little bit. But so that process was – you – what kind of products are we talking about? Were you like niche local people or were hitting up the wholesale distributors and reselling the big bucks brand-type things?
All about Drop Shipping
Connor: Sure, great question. So, we haven’t learned a lot about it when we first got into it. The way that we started was went into product categories that were really new for Amazon. The two new – the biggest ones for them were baby products and toys. And so, we followed them into these categories, and I’m sure you remember too, when the new categories first get off, before it got started on Amazon, there’s not as many sellers on it. So it’s easier to compete, it’s easier to get sales; it’s easier to create new product listings or jump on other ones and sell pretty well.
We sold a lot of baby products, toys, and then we expanded them into a lot of home goods, sporting goods, and we tested out a lot of different product categories just to see what would work. But it ended up coming back to those five main ones that really focused on the “dad and mom” demographics because they happen to be the people that were buying the most on Amazon.
In terms of the actual price of the brand and who went after, we kind of looked at it as like, tiers, right? We were a new seller, we were pretty young guys, young business. We first went after more of the mom and pop shops who have their own products but could also work with us through a unique drop ship relationship. We got started that way. We started to build up a collection of these people who could go to for the medium tier brands and say, “hey we’re already representing these brands and these companies. Let us sell your products as well.”
After we went through that medium we then went to the top. For the top ones, sometime you have to go through distributors or other ways to actually get the product. But we did eventually get up to that top level where we were selling high-level brands, especially during the holiday season to be flying off the digital shelves like there was nothing.
Fred: But you were probably, my guess would be that, at the end of the day you were probably more profitable with the smaller ones than the big bucks ones. This has been my experience when you get into distributors and big brands and distributors take their cut and then you know. That’s pretty awesome. And we were in that space at the same time, so I’ve got no doubt that every now and then you and I were competing in the buy box. I have a nice little growing Skype list of what we call “friendly competitors.” There’s so much room and space for everyone, so it’s actually refreshing and nice to be able to talk about that. But that is awesome.
But you know, even on my own business I kind of went on a similar journey although I probably went right into the wholesale/distribution type thing, right off the bat. And I’m almost circling back around now and trying to reduce my dependence on those because there are thousands of sellers buying from the same distributors – the same problems over and over. So reducing my dependency there and actually beginning to encourage people even when I’m doing one-on-one consulting to encourage people to think outside the box and go to those smaller brands so you can work those really cool relationships with. You guys, man, you did it right. That’s awesome the way you did that.
Talk to me about the some of the pain points because that’s going to transition us maybe into the next segment. Managing inventory and pricing that you do not physically have your hands on that’s not locked up in your warehouse can get tricky on Amazon.
Connor: Absolutely, that was definitely a huge pain point for us as we started getting into handling more SKUs and working with more suppliers. One of the biggest difficulties was that transition from creating a drop ship relationship with a supplier – to them, actually giving you their product’s data, their images, and everything that you need is actually a list of products on Amazon. And making sure that, the data they gave then was in the format that Amazon wanted so you could upload it easily.
So that was a big task to take on and as you know, if you’re working with – depends on who the supplier is – they can give it to you in an Excel file; they can give it to you as CSV. Some who are just completely outdated may send you a collection of PDFs that you then have to turn to your own file. So yeah, there are tons of headaches surrounding that.
So that was definitely a huge problem we had to address. And one way that we ended up handling that was, we created specific guidelines that all suppliers have the need to work with us once we were at a good level where we could start to reject some suppliers who were going to make our work a lot harder and not necessarily get us sales. And so we created those guidelines, and when we did that and started to implement those and started to weed out some of the suppliers that weren’t going to be helping us pretty much in the process of selling on Amazon, selling their products on Amazon, that really helped. And it really made our processes a lot smoother.
Fred: Yes, absolutely. I’m laughing just thinking back in the day when we were doing this for a local clothing store who wanted to get their private label clothing. I had a web designer full-time, it was he and I at the time. So it’s time to build out his website and his shopping cart, right? And so my web designer comes back with this horrific look on his face, I’m like, “What’s the matter man? Did you get the data we need to start building the site?” Basically, he sent him back with his catalogue, it’s like “catalogue catalogue”, like the Sears catalogue. It was like an inch and a half thick, full color, paper catalogue, you know, magazine. There was nothing digital. Nothing. Not a spreadsheet, not a picture, nothing digital other than this catalogue.
I think he cropped and copied and pasted shoes, and shirts and polos and slacks. I don’t know if that ever really worked out so great on that particular project. But when you’re talking about those pain points, it made me remember how that happened. It was really tough.
I see, you start making that transition – at the time that you were doing that, how were you integrating? Where you using any type of software or integration tool to manage your inventory and push your listings, anything like that?
Connor: Yes, we used a couple. We started with Appeagle which is more of repricing software. That was really how we started off to do repricing. Then we transitioned and tried out Channel Advisor for about a year just because of the ability to handle larger amounts of data. But again, what I kind of learned just through all software solutions they’re always going to get about 65% to 70% of what you need. And then there’s always going to be that 30% that you know its holding your business back a little bit.
We eventually, after running through both of those, ended up hiring someone in-house who built our own software out that’s very customized, managed our inventory, a lot is coming from our supplier network pretty easily and then pushed up to the Amazon marketplace. Once we finally got that set up, it was a very smooth process, but we definitely went through some ups and downs testing out the different software solutions.
Fred: Absolutely! That’s very impressive. Are you still using that same integration platform today?
Connor: Yea, we do. We still have the piece of the program that we use to manage our SKUs.
Fred: Oh, that’s fantastic. Have you been able to expand it into other marketplaces like Wal-Mart or Jet, or anything like that?
Connor: So we haven’t decided to, we wanted to keep our focus on Amazon just because that’s where our expertise lies. And myself, and my other two co-founders on the business, we’re not working on it full-time anymore because of other businesses and commitments we are on. So we’re really just trying to keep at the place where we know it works best and keep it rolling there.
50 Secrets to Bootstrap Million Dollar Companies
Fred: Absolutely. Well, I got to give you kudos and props man, this is so impressive, what you’ve done. And another thing that you’ve done that I’d like to just take a quick minute and tell people about is that you’ve written a book. A book called “Free up Your Business. Fifty Secrets to Bootstrap Million Dollar Companies.” So congratulations on the book. Just give us a little info real quick on that.
Connor: Yes, of course. That was a recent project that just launched on April 26 of 2017. So, a really big project that my business partner and me, that I started talking about a little over a year ago. And what we wanted to do was we wanted to really provide a great resource for people who want to be an entrepreneur, for people who are just getting started, or for a lot of the communities that we created with our clients and our workers through FreeeUp. And really just offer them the lessons that we’ve learned though a lot of the experiences we started talking about today. We’re going through a lot of ups and downs, and we tried a lot of things out. We failed along the way and we really narrowed it down to these 50 ebusiness philosophies, or as the book says secrets that we now use to run our companies and has allowed us to really create these million-dollar businesses. So that’s what the book comes down to.
Fred: That’s so awesome! Congratulations on publishing that. And for our EBO podcast listeners we have an exclusive offer for you, so listen up O.K.? This is too good to pass up. If you’d like a copy of this book and it’s for sale. You can actually buy that book on Amazon or on their site, but for a limited time, for our podcast listeners and those on our EBO Facebook group. If this is your first time listening by the way, you’ll hear me say “EBO,” E-B-O, and it’s just an acronym for ebusiness online. And those of us that hang out and listen to the podcast and network together and hangout in our Facebook group, we call ourselves “EBO” or so.
For all the EBO’ers, out there, Connor’s been extremely generous, he’s going to give you this book, OK? All you need to do is send a text message to 44222 and then that text message, just put the word “Bootstrap,” all one word B-O-O-T-S-T-R-A-P. So, just send a text to 44222 and then that text, just one word Bootstrap, and it’s going to zing back another text message right away and it’s going to ask for your email address and you just reply to that and that’s all you’ll do and it will immediately email the PDF of this e-book.
Listen, I know sometimes you think about these e-books and you think, “OK, great, it’s going to be a 12-page, little, cheesy – no this is not that. This is a 200 plus-page, this is a book. A book from someone who’s spin-off these million-dollar companies – fantastic information. So take advantage of that, we’ll have that link in our show notes too. But to get this book Free Up Your Business, 50 Secrets to Bootstrap Million Dollar Companies by Connor Gillivan, send a text real quick to 44222 with the word Bootstrap, and if you’re driving, pullover, come on. Don’t be thumbing this thing out right now when you’re taking your kid to school, alright? So pullover and send that in.
Thanks for making that available to us Connor, it’s extremely, extremely generous and we’re grateful for it. In the middle of this, you started having all these pain points. You got to hire people and I want to transition to the second segment because you started hiring a whole bunch of people at one point. You had how many, at your high point, how many people did you have working for your business?
Connor: Yeah, the highest point we had around 60 people, 30 were outsourced and then we had 30 in-house.
Fred: That’s a big business folks. That’s a whole animal right there. So you started doing outsourcing, and like I mentioned earlier in Episode 19, just last week, I talked about why maybe you might want to consider that. And after 10 plus years in ebusiness myself, actually I must say 10 plus in ecommerce myself because ebusiness – different types way before that. But I just actually hired my first virtual assistant this month. So I guess I’m in the party now.
I sort of took the plunge and I learned few things that I talked about in Episode 19. But you guys have done a lot of this and it really helped you transition into a new marketplace that you’re the co-founder of and the chief marketing officer, called FreeeUp. And that’s spelled with an extra “e”, F-R-E-E-E, and that “e” represents ecommerce, FreeeUp.
So, man, tell us about FreeeUp and you have a $20 million-plus Amazon business, you guys, you got partners, you’re killing it, you’re crushing it out there. And as if that’s not enough, like any good entrepreneur would do, you took a pain point and you saw a need, and you capitalized on that by providing a service to people. So kindly tell us about what you’re doing there.
How FreeeUp Started
Connor: Yeah, I’d love to. So, like you said, it all came back to a pain point again. When we were trying to scale Portlight and really build up our inventory and all the number of sales we’re getting through Amazon, we realize as entrepreneurs do that, there were too many tasks on our plate to be able to handle. I think anyone can relate to the entrepreneur, that’s one of the biggest hurdles you have to get over that, you can’t do everything, right? You think you can do everything at the highest level. And some people think they’re superhuman and just continue to pile things onto their plate. But we eventually realized that, we had to look for some extra help.
We heard through another entrepreneur in the Orlando area that there was this website, what used to be oDesk.com and is now Upwork, they merged with Elance. So we started experimenting with it. We went on and failed a lot at first. We failed a lot at first. We went right into dollar . We probably could hire people for $3 an hour and we didn’t put them through much of an interview process. We just brought them on and kind of hope that it would work out. So we went through a lot of ups and downs.
Fred: Alright, stop Connor. This is kind if eerie, this is sounding all too familiar. So I was slumping in my chair, starting to hide behind the mic screen a little bit. Keep going, this is good.
Connor: So we we’re doing this, we’re hiring these people and they’re just disappearing or they’re missing work and not communicating. We’re getting really frustrated. We’re wondering can this actually work. What is going on? At the same time we’re really trying to understand the interview process and understand the actual people that we want working with us before we’re going to be using this outsourcing deal.
And over a couple of years we hired over a hundred people, fired probably, seventy of them. And we we’re able to find the good group of people that were there to really help us grow the business. And in that process, we created this interview system and testing process that allowed us to really vet out the best workers through platforms like Upwork and oDesk and things along these lines. So around this time we had all these frustrations and we’re thinking there must be other ecommerce businesses that are having these problems too.
At the core of ecommerce, there’s so many operations that are repetitive, they are just mundane and can easily be outsourced to someone for a lower price that is also great at that particular task. And so that’s what led us to building FreeeUp. What we wanted to do was to make it a little different. So one of the biggest frustrations we had hiring through oDesk and Upwork and these other platforms was, you can go on, you post a work description, you can get a hundred applicants, you’ll interview people, and you’ll hire them. But at the end of the day you don’t if that person is actually going to be a good hire. And what we learned was, it usually isn’t. And then you’re back at step 1 trying to do the whole process again.
Fred: Or you know what, what I Iearned really quickly is, with my very very limited experience is, who you hire or who you interview is not necessarily who you’re really talking to, you know. So, you might have seen this – OK yeah, well, you know, her name is Brenda, but then when you finally talk it is Allan. And you’re like, “Allan? Are you a girl or a boy? What’s going on? Oh no, no, that’s my sister, and my sister and my brother and my cousin, we all use the same Upwork page” or whatever. “We all use the same account and pool all our projects together.” So, “you haven’t really done 400 hours? Who would be doing my work? You or your sister your aunt or your girlfriend, I’m getting confused here.” So I kind of experienced a little of that myself.
Connor: Yeah, for sure. We wanted to remove that issue, right? So the big difference with FreeeUp is we handle all of the interviewing, and the testing, and the vetting upfront for business owners, and just give you the opportunity to come in and to get access to a pool of the top 1% of talent within ecommerce. And now we’ve expanded to marketing and web development, which we’ve already put through our unique interview process to make sure they’re going to be reliable, that they actually have the skill set that they say they have, and that they also know how to communicate extremely well.
And so the business owner, you come to FreeeUp, you tell us exactly who you need by filling out a simple form that we have right in our software. We go ahead and process that, find the best person within our network for your particular project and introduce you via the software and also email. You have 15-20 minutes to talk to the person, make sure they’re the right fit. And then you hire them between $5 and $50 an hour depending on what the skill set is and the task associated. And then you get straight to work. You don’t worry about is this person reliable or not because they have gone through our interview process. You also don’t have to post a description and actually interview them yourself.
And then the great thing on the back end is we cover you there too. So we’re completely hands on, you always have someone to speak with if you have a problem, or if you have questions about hiring. And then in the rare case that a worker did actually leave, let’s say you hired a customer service person, they we’re working for you for six months and it took you a month to actually onboard them, and they ended up leaving after six months, we’ll go ahead and cover that first month for the next person that we introduce you to. So, we’re all about giving the business owner a really great experience with hiring online.
Fred: Yeah, that sounds fantastic! So, just give us a little – let’s pretend for a moment – this isn’t so far fetch because this is exactly one of the things that I just did. Before you and I were talking, unfortunately, so maybe, this would have gone differently. But so, I’m ready to hire someone, I need someone, I need to outsource error resolution. I’ve got 112,000 errors in Channel Advisor, products that aren’t listed on Amazon because there’s no image, or the SC code is not there, or there’s an attribute required on New Egg like screen size that is not provided by my distributor. That data is not readily available to me in bulk. So you have to begin to manually intervene. So yeah, I really need somebody to help me clear up these 120,000 product listing errors in Channel Advisor. How do I get started on FreeeUp?
How to Get Started with FreeeUp
Connor: Absolutely. So all you have to do is just you go on FreeeUp.com, there a sign up button on the top right, or this button throughout the website. You quickly fill out a little bit of information about your business. You go ahead and enter either a credit card or you can set up a bank account for ACH, or you can send a retainer to us through PayPal. And then you sign there a simple client agreement just saying that you’re not going to be stealing our workers as long as you’re into the platform.
Once you actually get access to your account after filling out that simple sign up form, there’s going to be a big button called “Request A Worker” right on the website. You’re going to click that, and what will happen is a form will come up. It’s going to ask you questions that’s going to say “What skill set do you need?” So you’re going to say ” I need someone to help me these errors”, it’s going to say “what’s the price range that you want to pay?” You can pick a price range or you can put in a specific price range that you want. You can specify if you want someone to be in the US or non-US because we have workers in both.
And then you’re going to fill out a couple more details below and just give us some more information about the actual worker you’re trying to hire. And then you’re just going to click the “Submit” button. And within 24 hours, sometimes even faster, you’re going to get a reply within your account and also via your email introducing you to the worker that could fulfill your needs. And then like I said, you can take some time, you can chat with them a little bit, make sure they have the skill set you need and that they’ll be able to fulfill your project. You can hire them right through the software, they will be added to your account, and you will be added to their account. And they can start billing the hours to you. And then you get billed invoices on a weekly basis.
Fred: OK, so how do – couple of questions – 1.) How do the freelancers track their time and 2.) How do I pay them?
Connor: Yes, great question. So there is a, the software that we have is a time tracking software. So like I said, you’ll have your own account through FreeeUp and workers have their own account through FreeeUp, and when you actually hire them through the software it adds both of you to each other’s account. So when you tell the worker, hey I need you to work for 2 hours from 9 to 11 am, Monday through Friday. At 9 am they’ll start working using the software, and you’ll be able to see that they are working, and they’ll be able to stop work after the 2 hours have gone up. After they finish working on a project, all workers are required to leave a comment on the hours that they worked, outlining what they completed, giving you some details. So there’s this whole, time tracking software within your account.
Fred: Right. And then when it’s time to pay them, we pay FreeeUp and FreeeUp pays them? How does that work?
Connor: Yup, so that goes to FreeeUp first, and then FreeeUp pays the workers and it happens every week. So our billing periods are from Wednesdays through Tuesdays of each week. And then clients receive invoices every Thursday, and depending on what your payment method is that you set up, you’ll just be automatically debited for the amount of time that your workers worked. And of course, if you have a dispute, or you don’t think that the worker’s hours are correct, you can speak with them about it, and if you can’t resolve it with them, you can come right to us. We’ll help you figure it out. We’ll talk to the worker, and if there’s any issues we’ll be happy to take care of it and comp you some free hours,
Fred: Right, OK, that sounds pretty cool. So, as far as the business – you’re making money, how? You’re on track past 3 million in revenues which is awesome already this year, over a thousand clients. And that’s not a gotcha question by any means at all. Is that a portion of what they get paid hourly, there’s a cut, or is there a fee that we have to pay to be a member of the platform? How does that work?
Connor: Yeah, great question. So there are no fees or any minimums or anything to sign up. If we tell you that you’re going to pay $10 for someone, you’re paying $10 an hour for them. But the difference that we make is between what we pay the worker and what we charge you. So our rate is usually about 20% mark up off the workers rate. But like I said, if we tell you you’re going to pay $10 an hour, that’s what you pay. There are no additional fees or anything on top.
Fred: OK, right. Well, let’s talk about that. So, for a lack of better words, a good ‘ol South Georgia boy, right – I’d like to consider myself a patriot, I’ve always tried to hire in the US, give work to my fellow Americans. There’s kind of a mantra right now, I’m sure you’ve heard right? “Hire American, Buy American, Hire American”. I kind of violated that myself, already. But I don’t want to use the word violate at all because it’s not a violation. But you know, sometimes that comes up when start talking about outsourcing work to other countries. It was a hot topic, even in our political environment, the presidential campaigns.
So, there’s always a tension there, but personally, you know, I think you summed it up beautifully when you said there’s some repetitive, menial task that really, hardly anyone really wants to do I bet. And there are people that are super grateful and effective at doing these tasks and the money that you pay them is actually very fair wage in their country – maybe I’m answering the question for you. But I would just love to just kind of hear your principle on that, where you’re coming from. Because you’re sitting at dinner with someone and their like “what do you do? I run this outsourcing marketplace – Oh, wow.” When that comes up, how do you handle that?
Connor: Yes, for sure, I mean that’s definitely something we thought about when we were first getting into it because when we we’re first starting, you don’t really know who you’re hiring, where they’re coming from, or what situation they’re in. We definitely has some skepticism at first about should we be looking for people in our direct area, is what we’re doing OK, ethical in a way. What we’ve kind of learned over the years of hiring people from – we hire a lot of people from the Philippines – what we’ve learned is that we’ve come to know these people so well and we’ve realized that they’re – people are people everywhere, right? Even though they’re getting paid a little bit of a lower wage, in the grand schemes of their environment, they are middle to a higher class in their community because they’re able to work digitally and they have these specific skills set within, let’s say, ecommerce or digital marketing, or advertising, whatever it is.
I think that the whole digital economy has really made the borders less significant, in my eyes. I’d likely give the work to the best person who’s going to be able to help my business grow. And sometimes that comes down to having the best price and then also having the best skill set. I don’t know, I think it’s always a touchy situation, a touchy conversation, but I think once you get into it, you learn a lot more about the people involved and how it isn’t like a sweatshop situation, that all outsourcing is bad, you know what I mean?
Fred: I don’t believe that. Not even for a minute. Because like I said, I’m a patriot, man, I want to support my country as much as I can and at the same time I’ve got several private label products that I bring in from overseas. And I just haven’t been successful at getting those done here. And in the same way it’s not economically feasible for me to have some of these tasks done for the hourly rate that I would have to pay here in the States. So, I’m with you man.
Listen, one of the things that I thought of that I think this hopefully help our listeners and you touched on it, but I want to make sure they didn’t miss this. If you are in a place, you’re running an ecommerce business, you’re listening to the podcast, they’re like thinking, that’s cool, I’m not ready to take the plunge to hire a full-time VA. If I hear you right, you can hire somebody to work for 1 hour or a day, or 2 hours a week. It doesn’t have to be a huge full time commitment, is that right?
Connor: Absolutely, and that’s really the advice that myself and my business partner would give to most people. Even for the freelancers we’ve hired at FreeeUp, we have about 25 people, but they’re all split up into part-time specialized work that are, they’re either working one to five hours a day. And that’s really the best way to start. If you’re running an ecommerce business, get yourself out of customer service. Maybe that’s taking you 3 hours a day where you’re just answering emails, and taking phone calls. You can hire someone for 3 hours day at a pretty affordable rate. That’s off your plate, and allows you to build something else and grow the business. So definitely it starts slow when you’re starting to hire VAs or these part-time remote workers, you don’t even go all in. And that’s usually when people have the worst experiences. So definitely start slow and make sure that it works for what you’re doing.
Fred: Beautiful, man! I tell you what, thank you so much for coming on the show and just telling us all about yourself and your Amazon business and your story as an entrepreneur. And really intrigued by what you’re doing with FreeeUp there and remember if you’re listening to podcast, if you want to type that into your browser, it’s FreeeUp, F-R-E-E with an extra “e.” So Free-E-Up. Think about that extra “e” for ecommerce, and we’re going to have links to all of these in the show notes. But, also, you want to check out Connor. Connor’s got his own site, ConnorGillivan.com. We’ll have links to that on the show notes. And he blogs and writes, he’s been a guest in several other podcasts. And he’s been featured in Web Retailer, Red Rocket VC, Ecommer All-Stars, Podcast, lots of places. We’ll throw up – boy that sounded good – we’ll throw it up! We will throw, together, we will put, place, Connor’s biography on the show notes for this, that’s E-businessoline.com/episode20, 2-0. And then let people get in touch with you that way.
So again, look, you want to take advantage of this offer? You got this free book for a while. We’re not going to leave it there forever, OK? Because if you don’t take advantage of it soon, we’re going to send you to Amazon where you can buy it. And bless this guy, who sweat it out 200-plus pages of an amazing book entitled, Free Up Your Business: 50 Secrets to Bootstrap Million-Dollar Companies. You want to get that right now for free just send a text to 44222 with the word Bootstrap in there, B-O-O-T-S-T-R-A-P.
Connor, it has been a real privilege to have you, man. I hope this is the first of many conversations we have. Love the path you’re on, love seeing what you’re doing and the way you are empowering and helping others. Thank you so much.
Connor: Fred, thanks for having me, it was a great time chatting. Definitely looking forward to keeping in touch.
Fred: Absolutely! Hey, man with that, I’m going to let you go and this is Fred McKinnon, once again, here we are on the E-businessonline podcast episode 20. I’m raising my glass to you, to your success, to your prosperity, God bless you! Go out there and sell something, go out there and win, win, win!
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