Hey there!

The biggest benefit of entrepreneurship is freedom.

The biggest risk of entrepreneurship is self-inflicted stress.

When you work for yourself, good decisions are euphoric—because you’re the one who made them, and you’re the one who basks in the glory. But what goes up can also come down. And when you work for yourself, bad decisions feel catastrophic—because you’re the one who made them, which means you have no one else to blame but yourself.

One of the most common problems first-time founders and/or solopreneurs face is accidentally building a business that “runs them.” This largely happens because, when you’re first starting out, you’re so consumed trying to figure everything else out—creating a valuable product, learning marketing, learning business models, etc.—that the thought, “Does this business create the life I truly desire for myself?” rarely crosses your mind.

Until it’s too late.

So, we want to help you avoid ending up in that toxic place.

As you build, here are 8 questions you should ask yourself OFTEN to see whether you actually run your own business (and are unlocking all the “freedom” benefits of entrepreneurship) or if your business runs you.

1. Do your employees have jobs or do they have careers?

Prison businesses give employees jobs.

Castle businesses give employees careers.

In both cases, the goal of the employer is to make their employees as profitable as possible. But the way you go about doing so is different if your employees have jobs or careers.

Jobs are pure time for money exchanges. Employees with jobs are not revenue-producing, which means the only way to make them more profitable is to pay them less.

Careers are performance for money exchanges. Employees with careers are revenue-producing, meaning you can directly tie their activities to increased revenue. And more importantly, their compensation is directly tied to that incremental revenue (meaning they share in the upside).

Now, why is it important to give your employees careers, rather than jobs?

If all your employees only have jobs, you’re likely to build a culture filled with churn, burn, and high-turnover. The incentives of every employee with a job are to eventually find their way to a career. And if they don’t have path for that within your company, they are not going to be around for very long.

On the other hand, if your employees have careers, you’re likely to build a culture with aligned incentives and maximal ownership.

So for a simple step forward, ask yourself how can you create compensation structures that align the incentives of you and your employees.

2. Is the industry you’re building in growing or shrinking?

It is impossible to build a Castle Business in a shrinking industry.

This is because Castle Businesses are designed to grow and run forever. And the only way for this to happen is if there’s an abundance of 2 resources flowing into the industry:

1. Labor: people wanting to work in the industry

2. Capital: people want to put their money in the industry (either investing or spending)

Hitching yourself to a growing industry and “riding the wave” can give you more margin for error in your operations and execution.

Which is why Warren Buffet said: “A rising tide lifts all boats.”

So to figure out if your industry is building or shrinking, answer these 2 questions:

1. Over the next 10 years, are more people going to work in this industry, or less?

2. Over the next 10 years, are people going to spend and invest more money in this industry, or less?

For example, let’s pretend we were considering starting a business in the education space—and we were choosing between traditional education and internet education.

1. Over the next 10 years, which industry will have more people looking to work in it? Certainly digital education. Traditional educators will slowly see the path for financial and intellectual freedom that comes with independent internet education.

2. Over the next 10 years, which industry will have more money flowing into it? Certainly digital education. The chart below speaks for itself: the cost has of traditional education has been a straight line up, while the outcomes haven’t budged. Surely there’s a better path.

3. Could you take a 4-day weekend without any negative impact to the business?

If you cannot answer “yes” to this question, you have a Prison Business.

And the only way to tell is to run a hypothetical experiment pretending you had an emergency from Thursday to Sunday this upcoming week.

In running that experiment, make a list of the following:

1. What important meetings would you miss?

2. What actions would my team be unable to do without me?

3. What deliverables (content, support, etc.) would go unfinished?

Voilà, you now have a list of activities and responsibilities you can begin to automate, delegate, or stop doing entirely.

But it’s important to remember this is not a list to try and solve all at once.

Rather, it’s something to keep top of mind and slowly chip away at over time.

Also—the point of this question is to not to help you build a business where you take a 4-day weekend every single week.

Instead, it’s simply a forcing function to build the operational efficiencies that enable the business to grow forever.

4. Do you have 3 hours of uninterrupted thinking time per day?

Again, if you cannot answer “yes” to this question, you have a Prison Business.

We learned this the hard way during certain times of building Ship 30 and PGA.

Our eyes would shoot open and we could immediately feel the cortisol bubbling up. And rather than having time to think deeply and build something new, we cracked open our laptop to a mountain of fire alarms ringing via email and Slack.

And this was a symptom of one crucial mistake: weaving ourselves into being the key decision-maker for every area of the business.

• Sales

• Marketing

• Operations

• Student success

• Customer support

• Community engagement

• Relationship management

Making moves in any of these areas required approval from one of us. Which meant we were the bottleneck to the basically anything getting done inside the business.

And this kept us stuck until we finally took the steps of:

1. Hiring for responsibilities in each area

2. Delegating those responsibilities over time

3. Empowering our team to make decisions they deemed to be the right ones

As we slowly gained our precious morning thinking time back, we began to work “on” the business rather than “in” the business.

And this ultimately led to pursuing new opportunities and profit streams (like this newsletter!) that we otherwise would have missed.

5. Is your business built purely on rented channels or do you have owned channels?

Rented channels are platforms like Twitter, Linkedin, YouTube, and Instagram.

Owned channels are things like email lists and SMS lists.

On rented channels, the platform is the landlord. At any time, they could kick you out, raise your rent, or knock the building down entirely.

On owned channels, you are your own landlord. At any time, you can directly reach your customer list without any interference from someone else.

Now, building a business via rented channels is the fastest way to get started.

It’s also the fastest way to lose it all.

Yes, harnessing the distribution of Twitter, LinkedIn, and Instagram will help you grow exponentially faster than if you only published content on your own blog.

But, you are one decision away from losing that entire platform.

• Algorithm changes? Poof, there goes your business

• Platform falls out of style? Poof, there goes your business

• Moderators decide to throttle your account? Poof, there goes your business

So while it’s the right choice to start building on rented land, it’s important to take steps to build a moat along the way. That way, you remain in control of the trajectory of your business (rather than giving control to the platforms).

If you’re reading this and realizing your business currently sits without a moat, there are 2 main steps to start taking:

Decentralize your rented land by adding additional platforms

In the beginning, you should focus on 1 platform with 1 product until you reach $1 million in a year. Spreading your time and attention across multiple platforms will not be as lucrative as going all in on one of them.

But from there, it’s wise to diversify and decentralize your platforms, just in case one of them goes under.

And the easiest way to do that is to start building on a channel that is the same “medium” as your current channel.

• If you’re writing Twitter, start writing on LinkedIn

• If you run ads on Facebook, start running ads on Google

• If you’re making videos on YouTube, start making reels on Instagram

• If you’re making an educational podcast, start building a Telegram voice note channel

The goal is to maintain the ability to generate traffic & attention without:

• Spending a huge amount of time making new content for a new platform (like a Twitter writer starting to make YouTube videos)

• Being at the mercy of one platform decision (like Facebook banning your ad account)

Bridge followers from a rented platform to an owned platform

The king and queen of owned channels are email lists and SMS lists.

These two are the only ways to reach your audience without any reliance on social media.

And the easiest way to start building these lists is with these 2 steps:

1. Spin up a “lead magnet” to link underneath your social content. This could be a newsletter, a template, an eBook, an Educational Email Course, or a waitlist. This edition from our Write With AI newsletter can help you with that.​
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2. Provide the free value in exchange for their contact information. If you’re building an email list, ask for their email and send it to them there. If you’re building an SMS list, ask for their phone number and text it to them there.
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3. Create relevant social content to the lead magnet to drive traffic toward it. For example, we follow up all of our writing-related tweets with a link to our startwritingonline.com Ultimate Guide & Educational Email Course.

Don’t spend too much time overthinking this one—especially not at the expense of generating more social traffic.

Instead, just pick something you think your audience would 1) find valuable and 2) be interested in paying for. Then, give it away for free.

6. Are you optimizing for vanity metrics or meaningful metrics?

Vanity metrics sound great to say aloud, but they wreak of inefficiency.

Meaningful metrics don’t attract the big VC checks, but they put the show you the true health of the business.

For example, if you ask the average business owner how “business” is going, chances are they respond in one of the following ways:

• “Things are great. We’re up to X number of employees.”

• “Things are great. We’re up to X amount of revenue this month.”

• “Things are great. We’re as busy as ever, putting in 12 hour days.”

Number of employees, amount of revenue, length of the workday—these are vanity metrics.

Instead, picture a world where they responded like this:

• “Things are great. We’re at an all-time high revenue per employee despite adding another team member this month”

• “Things are great. Our operating margin is 40% and we just had our most profitable month.”

• “Things are great. We just implemented a no-meeting Friday and employee satisfaction hit a 6-month high.”

Revenue per employee, operating margin and employee satisfaction—these are meaningful metrics.

And the reason why most business owners optimize for these vanity metrics?

It’s easy.

• It’s easy to make revenue go up when you don’t keep your margins healthy

• It’s easy to increase headcount when you don’t make sure each employee is actually contributing to new business

• It’s easy to make your employees work longer hours when you don’t actually keep tabs on the work they’re doing

On the other hand, meaningful metrics are only meaningful because they are difficult to improve.

But when you start to think this way, you build the foundation of a healthy Castle Business that can grow forever.

7. Are your resources compounding, or are they churned and burned?

The difference between a business and a series of promotions comes down to how your time, energy, and attention compound.

If your resources are churned and burned, you have a promotion. All of the efforts you put in today will only pay dividends while the current promotion lasts. Then, you have to start all over.

If your resources are compounding, you have a business. All of the efforts you put in today will pay dividends to you in the future. And all of the efforts you put in in the future build upon the foundation you’re building today.

For example, you could spend 100 hours sending cold emails to potential clients for your Ghostwriting Agency. This might lead to a couple of clients in the short-term, but these efforts won’t build anything that will still be working for you in 6 months.

On the other hand, you could instead invest 100 hours in creating educational content around why your ideal Ghostwriting client needs a ghostwriter. Now, this won’t lead to a client as quickly as your cold email campaign would. But, the 100 hours you spend on a future cold email campaign will be more valuable because of the educational asset you created beforehand.

To get started, take a look at your activities over the last week:

• How many of them will continue “working” for you in the future?

• How many of them were “one-and-done” effort exertions that you can never get back?

Then, rearrange your activities to spend more time on the first kind and less time on the second kind.

8. Are you focused on reinvesting in the business or extracting everything out of it?

Finally, the only way to build a lifelong Castle Business is to constantly reinvest in it.

Mr. Beast is the perfect example of someone building a Castle Business.

Since the beginning of his journey, he has invested practically every dollar of free cash flow his business generates back into the business.

When he signed his first ever brand deal, they offered him $5,000 to sponsor the video.

Most people would have taken that $5,000 and simply mentioned the brand with a mid-video shoutout.

However, Mr. Beast had a better idea.He asked them to make it $10,000. And instead of taking the money for himself, he wanted to make a video giving away that $10,000 to a random stranger. That video was an instant hit, generating millions of views and lighting a spark under his YouTube rocket ship. You could picture the alternative universe where he never reinvested that initial money and instead collected 1-off brand deals for a couple years, generating a few hundred thousand and calling it a success.

But instead, he’s on his path to becoming a billionaire.

Now, does this mean you should take literally every dollar and reinvest it back into the business?

Of course not.

The point of a Castle Business is to build personal financial foundation while simultaneously building a business that can grow forever.

So an easy stress test question to ask:

1. If you were forced to reinvest 50% of your profit back into the business (rather than take it out as dividends), where would you invest that money?
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2. If you were to actually invest that money in this way, would it lead to a more valuable or less valuable business in 12 months?

That’s it!