Yeah, seriously though. Cash flow statement is essential. MOST WISPs fail within three years because they don't make it to cash flow positive before they run out of operating capital. Do not underestimate your expenses. Track everything. TRAIN YOUR CUSTOMERS. If you have overages, bandwidth limitations, ect. let them know up front. Tell every customer to pwer their router if they don't have Internet (show them how), THEN call you if that doesn't work. This will save close to 90% of your calls.
On Tue, Jan 6, 2015 at 6:13 PM, Ken Hohhof <af...@kwisp.com> wrote: > Not totally joking. Undercapitalization is a major mistake of most > startups including WISPs. You need money to make money. > > Make a month-by-month plan for your first 2 years and do a cashflow > spreadsheet. Set targets for how many installs you plan to do each month, > how much you revenue you will generate, how much you need to spend on > equipment and recurring expenses. Set milestones for when you can fund > growth from cashflow, when you have repaid your initial investment or > loans, when you need to add staff and will the money be there, etc. Review > progress each month and adjust as necessary. But this will help you avoid > being underfunded to achieve your goals, or not reaching profitability in a > reasonable timeframe. It’s too easy starting out to use a simple > calculation like I’m paying $500/month for bandwidth and I charge $50 so > once I get to 10 customers I’m profitable. Then a year later you’re at 100 > customers which seems like success, but you have maxed out your credit > cards and aren’t drawing a salary and can’t hire a full time installer, and > you need major network upgrades and don’t have the cash. > > Also while you don’t need to budget every penny, you need realistic > estimates of all your costs, not just the big, obvious ones. Like assuming > you take credit cards, some of the revenue will go to processing fees and > “discount”. You will have some bad debt from customers who don’t pay, and > you will have some churn if only because people move, get divorced, and > die. You will go through supplies like cable and hardware for > installations, and you will spend a certain amount on maintenance. You > will have costs like insurance and lawyers and accountants and postage and > utilities. At least come up with a rough number for these, and refine > based on experience. > > If you use your own vehicle, at least pay yourself the IRS standard amount > for mileage. > > Find another WISP nearby and make an arrangement to cover for each other > in case of sickness or just so you can get away for a few days. > > Decide what your business hours are and how to handle calls outside > business hours. Also decide on a way to notify customers if you have a > major outage so you aren’t answering the phone when you should be working > on a problem. For example, a message on your voicemail. > > Train your customers from day one. For example, let calls go to voicemail > after hours and call them back, or they will assume they can call any time > of day or night. Or if you say you will suspend service when payment is X > days late, do it. If they never get to expecting things, they won’t be > pissed off when you take them away. Like Trevor used to answer his > cellphone at all hours, now I have to call the office and leave a message. > Or the service has really gone downhill, I used to get 20 meg speeds now I > only get 10 (even though they are on a 5 meg plan). Or I used to wait 3 > months and then pay up, now if I’m 5 days late, they cut me off. Better to > set their expectations early. > > > *From:* Jeremy <jeremysmi...@gmail.com> > *Sent:* Tuesday, January 06, 2015 6:34 PM > *To:* af@afmug.com > *Subject:* Re: [AFMUG] New WISP > > > Have a million dollars. Cash. > On Jan 6, 2015 5:23 PM, "Josh Luthman" <j...@imaginenetworksllc.com> > wrote: > >> Get a billing system. Powercode or whatever. >> >> Don't finance customers that can't pay up front, wastes billing time >> instead of installing more customers. >> >> Don't use your cell phone for the office. Get a hosted PBX. Close the >> shop so you don't get burnt out, have other people and or a call center. >> >> Josh Luthman >> Office: 937-552-2340 >> Direct: 937-552-2343 >> 1100 Wayne St >> Suite 1337 >> Troy, OH 45373 >> On Jan 6, 2015 7:21 PM, "Trevor Bough" <trevorbo...@gmail.com> wrote: >> >>> Hi guys, long time listener, first time caller. I'm looking at starting >>> a new rural WISP and was wondering if you guys could share some of the >>> things you wish you had known when you started out. Things to absolutely >>> stay away from, things that you didn't think of first, but made your life >>> 10x easier, etc. Any info would be greatly appreciated! >>> >>
