Why One Founder Ditched His Funded Startup for a Lifestyle Business

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This is a guest post from Jun Loayza of Tour Woo. Many of you have asked for case studies from other successful lifestyle businesses.  I couldn’t think of a better person than Jun to share his story, especially since he’s had experience in both the startup and lifestyle worlds. Enjoy!

Internet startups have an irresistible mystique:

• Instagram is acquired by Facebook for a hefty sum of $1 billion!
• Draw Something sold for $250 million just 2 months after it launched!
• The Facebook IPO was valued at a whopping $104 billion!

The allure is quite obvious: entrepreneurs get to play with other peoples’ money to create a cool/fun/innovative project that eventually sells for millions or even billions!

Hi, I’m Jun Loayza and I’m a recovering internet startup entrepreneur.  During the course of 5 years, I failed with 1 internet startup, successfully sold 2 internet startups, and raised over $1,000,000 in angel funding.  After living in Silicon Valley for two and a half years, I’ve decided to leave the internet startup cult and join the promising world of lifestyle businesses.

Why I left the internet startup cult

I’ve become disenchanted with the internet startup world.  I feel that the standard internet startup mentality has been reduced to the following:

Lets build a cool random social app, raise millions of dollars, get tons of users, and sell within 3 years for a bunch of money!!!

And there’s nothing wrong with that.

But people need to realize that for every Instagram, there are hundreds of failed startups that didn’t make it.  Furthermore, business people, the people like you and me who are not developers, have an absolute abysmal chance at making it in the internet startup space as a founder.  The reasons: we don’t know how to code.  Because we don’t know how to code, we’re at the mercy of the product, at the mercy of our CTO or CPO, and we don’t get much respect from investors.

I’ve seen many of my close friends waste their time and money on ideas and dreams that really have no chance – and I blame the internet startup culture.

The difference between an Internet Startup and a Lifestyle Business

Internet Startups

• End goal: sell for millions within 3-5 years
• Hiring strategy: hire the best and brightest engineers, designers, and business people to grow and scale as quickly as possible
• Funding strategy: raise as much money as possible with a favorable valuation
• Company culture: work as much as possible – you’re seen as a hero if you stay until 2am in the office
• Business model: get users to get funding to get more users and exit – maybe find a way to generate revenue

Lifestyle Business

• End goal: build a sustainable revenue stream that is systemized to operate on its own
• Hiring strategy: stay as small as possible and only hire people to run systems and operations that have been established
• Funding strategy: self-funded – no outside funding
• Company culture: work hard, but aim to minimize hours worked
• Business model: profitable from the very beginning

The lifestyle business philosophy

Startups don’t need to be difficult; they can actually be quite easy if you play to your strengths.  From this post forward, I want you to live by this mantra:

I will use my current skills and abilities to build a product/service that solves a pain that my current network has and that my current network is willing to pay for

This is the exact mantra I used to build and launch Tour Woo, the easiest way to book a tour online.

My current skills and abilities

I’m good at many things: I’ve closed deals with big brands such as Sephora, raised a significant amount of money from investors, and I’ve built teams by getting strong talent to leave their current employer to join my startup.

But above all else, I’m the best at driving relevant, targeted traffic to a website.  Therefore, my next project needed to have a business model that revolved around driving traffic to a website.

Solves a pain for my current network

A big chunk of my network is composed of 25 – 28 year old professionals that work at a corporate 9-5 job.  Because they’ve saved money and time-off for a while now, many professionals in my network are starting to travel the world.  I therefore looked to solve a pain in the travel industry.

I analyzed the market and found that the hotel industry and flight industry have dominant sites such as Expedia, Travelocity, and Kayak.  But when I analyzed the tourism market, I found that there is no clear dominant player and that the tourism market abroad is very fragmented.

Profitable from the very beginning

This industry is great because tourists are ready to spend money; furthermore, tourism agencies are hungry for my clientele.  Therefore, I’ve positioned myself as a website that can drive targeted, relevant leads for tourism agencies.  Tourism agencies pay me a commission when my travelers book a tour with their company.

It’s a simple, direct, and effective business model.

How to drive traffic to a website

This is what I do best

Here is a step-by-step guide to immediately get started with driving traffic to your website:

Step 1: Find your target keywords

Utilize the Google Keyword Tool to find the keywords that you need to target for your market.  The key numbers to look at:

• Local Monthly Searches: this shows an estimate for how many people in your country search for the key phrase
• Competition: this shows roughly how difficult it will be to rank well for the key phrase

The sweet spot: look for key phrases that have high local searches and medium to low competition.  It may be hard to find, but get creative with keywords and you’ll find them.

Step 2: Write key phrase rich content that is also very helpful to your target audience

It’s very very important to write great content that will convert leads.  Likewise, it’s very very important to write content that will rank well on the search engines.

Take a look at my page called tour Peru.

You’ll notice that the key phrase I’m targeting is “tour Peru”, which by the way is highly competitive.

I have included the key phrase in the following sections on the page:

1. <title>tour Peru</title> section
2. In the URL
3. <h1>tour Peru</h1> section at the top of the page
4. In the body of the content

Furthermore, I have inbound links to other relevant pages on my site.  For example, the Tour Peru page links to the tour Machu Picchu page, which is another key phrase that I’m targeting.

Sean’s Note: See that link up there for tour Peru? Great example of how a guest post can benefit both the readers and you’re new venture.

Step 3: Get external links to link to your website with the keyphrase

There are many options to accomplish this step:

1. Write a blog post for a friend (thanks Sean)
2. Subscribe to HARO and respond to relevant news opportunities
3. Contact blogs in your industry about why you’re newsworthy and who else has covered your story

Step 4: Submit to relevant directories

Go to Google and type the following: allintitle: ecommerce directory

Replace “ecommerce” with your industry.

You’ll notice that this is an easy way to get a result for every site that has “ecommerce directory” in the title.  I can then go to each of these sites and submit my website to the directory.  Some of these sites are free and other are paid.  If you’re on a budget, start off with the free directories.

Step 5: Send out a news release through PR Web

My startup RewardMe utilized PR Web to send out a very effective news release.  You can read more details about how to launch a press release here.

We used the $499 version of PR Web, so we waited until we had very good content online before we invested in the press release.  The content that we linked to from the press release:

• Targeted pages within our business website
• Our PDF case study
• Our video case study
• Our blog content

My goal is to establish Tour Woo as a consistent revenue stream that will allow me to travel and work from anywhere in the world.  Shoot me an email if you have any questions about how to start a lifestyle business or how to drive traffic to a website.

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Jun Loayza is the founder of Tour Woo, the easiest way to book a tour online.  In his startup career, Jun has sold two companies, raised over $1,000,000 in angel funding, and lead social technology campaigns for Sephora, Whole Foods Market, and Levi’s.  Reach out to jun at me [at] junloayza.com

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