Managing Growth And CashFlow

Managing growth was one area I wish I had a little more experience in when I was first starting. I wasn't very wise with how I grew initially because I wasn't as much of a problem solver as I am today.

In fact, there would be days where I would flat out have to turn off profitable campaigns because my credit card was maxed and the payment had not gone through yet. Crazy, I know.

My Growth Story

Over the course of the past three years, I have seen some huge growth financially and managing that growth was quite a challenge at first for me. I had some guidance but really it was still a bit tough.

Credit Cards...

When I was first seeing growth in affiliate marketing, I was a student, had about $8,000 in credit card limits, all fully paid off, $0 debt, $0 bills (thank you Mom and Dad ), and things were great. But as I began to grow, $8000 really became nothing in the spectrum (and today especially) of things.

For a while because I was naive, I would just charge up my credit card to as much as possible and pay it all off as soon as I got paid. Many times I would have a charged up credit card and would just be sitting waiting for payments to come. As you know this can be terrible for your credit (and hurt mine quite a bit for a little while there).

After realizing that my credit score was going down consistently due to the way I was running my business, I decided to ask some high limit credit friends for some help and try to raise my limit.

Borrowing Credit

Raising my credit card limit was a total failure. I got a raised limit of around $1000. Big whoop right? Next...

I had a good friend of mine who offered to let me use his $20,000 credit card. The full card was essentially mine. I would use the credit card and then pay it off and pay my friend a nice little chunk of change as his cut for helping me grow my business.

This worked for a while and things were great until... I started growing more. Soon $20,000 became nothing. I was spending a few thousand a day at the time and $20,000 became a few days worth of advertising. No longer viable and I certainly did not want to ruin my friends credit score by doing the same mistake twice!

Invoicing

Onto the next plan. I researched, researched, researched and finally ended up calling google adwords billing support to talk to them about what I could do.

I was spending $50,000- $60,000 per month at the time and needed a better way to manage my growth. I asked them if there was any way I could get a line of credit or something from them and they told me about Google Invoicing! (Insert turning point to business here )

Google Invoicing is essentially a line of credit where you apply to allow your Google ads run for the month and you pay them within 30 days. It's only available to higher volume clients and there are a few downsides.

First, you can't switch your account back to credit cards once you have switched to invoicing. They're going to go through the trouble of credit checks, D and B checks, payment history, etc and want to make sure you're not just using them for a I'm having a slow month method of delaying payments. No switching back at all, ever.

The other downside is you can only pay via check or wire. You cannot pay via credit or debit. Good bye credit card points! The idea behind this is that you're essentially paying Google 2-4% (because checks / wires essentially cost them nothing) in interest for delaying payment 30 days. Credit cards charge 2-4% if you didn't get it.

Although there are some downsides to this, it was one of the single biggest turning points for my business. I took a bit of a risk when I was being interviewed by the lady and told her that I wasn't even going to be interested in the invoicing unless the limit was $150,000 per month or more and that my growth records have shown those numbers to be true.

They replied back shortly after congratulating me on a $350,000 credit limit per month. Not bad for a 20 something year old college drop out.

That's where my business began to grow and cash reserves built up to where I could afford to pay the advertising costs with no more issues.

Tips For Managing Growth

Use credit cards if you are certain you are making a profit! I HIGHLY recommend you don't use credit to try and test. It's a dangerous game and you might end up with a heafty bill you can't afford. Affiliate Marketing has been around since the 90's for the internet and it's not going anywhere. If you can't afford it this month, WAIT until you can. Sacrifice your Starbucks or whatever so you can have an ad budget.
If your credit is poor, Use friends credit cards. This might be hard to find, but friends and family who are following your growth might be interested in making some passive investments. Always make sure to put paying their credit cards down the first priority, even over your own bills.
Try Google Invoicing. It works for some people and you never know if you will get accepted until you ask. It does not hurt to try and certainly can help you out a TON with cash flow.
Ask your affiliate manager for faster payouts. If you're on net 15 payouts and you're having cash flow issues, ask to be paid faster. If it's over $1000 / week, simply say you need to be paid or you'll have to switch to a network that can pay weekly. Places like Copeac offer weekly Payouts for over $1000 in revenue by default. There is no reason why they should hold onto your money for longer than that. Besides, you should tell your manager that it will help you grow and make them more money... They will love to hear that.
Be a problem solver. There are so many options out there. As a business person, YOU solve problems. Brain storm which solution works best for you and try, try, try. If you try, you will succeed eventually.
Apply to a network like Copeac. They offer weekly payouts for those earning more than $1000 / week.

Hope that helps!