Going Into Debt For Your Business

In this week's episode of Chill & Prosper, we are talking about credit cards and loans - should you go into debt for your business? 

I spent my twenties paying off a ton of debt - and now I live by a very simple Seth Godin rule!

I’ve got 5 strategies for you to avoid getting into a ton of debt for your business.


I talk about ...

  • Embracing imperfection
  • Practicing the incremental upgrade
  • Investing in things that bring in clients and money first.
  • Budgeting in other areas
  • Getting into action
  • Focusing on income producing activities


Hey, gorgeous. Today, we are talking about going into debt for your business, whether it's credit cards or business loans and stuff like that.

Juicy topic, and one that you might have thoughts about. So of course, as you're listening, feel free to @ me on Instagram. Tweet me on Twitter. My social handle is @deniseDT everywhere over the internet.

Okay, so I'm actually going to... Just spoiler alert, I am not into getting into a ton of debt for your business, and so I'm really going to talk about five ways to avoid getting into a lot of debt for your business, even though, I have to admit, I did it a little bit in the early days, and I know what it's like when you feel really tempted to get a credit card, maybe you get offers in the mail all the time, or to take out a business loan.

Now, often in entrepreneurial world, people even tempt you to do it. They're like, "If you're really serious about your business, or if you are really serious about making money, then you'll fake it til you make it, and you'll buy my course and put it on a credit card." And today, I really want to bring you some Denise truth talk about this, about whether or not you should do it, and whether or not you should accrue debt to start or grow your business. Okay. One thing that I want to share that really changed my mindset was Seth Godin. He did a little blog post about this called Should You Raise Money for Your Business? And in this particular case, he's talking about if you should get investors. And he said, "When in doubt, raise the money from your customers by offering something that they need."

So when in doubt, raise money from your customers, by selling them something that they need. And I just think that is such a great guiding light. Every time you attempted to take out a loan, a credit card, borrow money for your business, doesn't mean you shouldn't do those things. But, the first thing is always raising money from your customers by selling them something that they need. Now, you think about going... Let's go back 30 years time, right? If your mother or your grandmother wanted to start a business, or your dad, chances are, they did need a business loan, because even just doing something, like making a website used to be so, so, so expensive, and it was something that you just couldn't do yourself. You needed to hire an expert to do it. Even apps, like when I did my app, I needed to hire somebody to do that for me.

If you wanted to start a business that had physical products and services, you needed to spend a ton of money getting that started. And nowadays you really don't need to. With all the awesome tools available to us, the technology, you really can start a business. We have almost zero upfront staff and upgrade as you go. Now, my business, I make about three and a half million dollars a year. My fixed costs aren't that much different than my early days, and I really like to run my business in a really lean way, but there's been times where I thought, "Oh, maybe I should get a new sexy website. Maybe I should start a new app." And I do that as well. And so I have a motto that always brings me back down to it and it's like, "Sell more boot camps. Sell more Bootcamps. Sell more Bootcamps."

So yeah, I've done it. I've done it myself. So I've got six tips about different ways you can avoid taking out a business loan. Okay. So tip number one is embrace imperfection. Embrace where you're at. Okay. Not everything has to be super sexy, ever, and in fact, I have done the research on these. Okay. So, I mostly did all my own stuff in the early days, as in I did all my own graphics. I did all my own website stuff, and this was like the olden days where it was so too hard to make your own graphics. Nowadays, you can just do it on Canva. You can do it on PicMonkey. You can do it on Word Swag. There are so many apps for you to create your own branding so much easier than it was in my day. In my day, I'm an old granny.

In my day, it was so hard. But, you can still get caught up in what I call procrasti-branding, where you're like, "It's not perfect yet. I don't have the perfect hex color." And you feel like you have to spend a ton of money to make it perfect, and you really don't. You can embrace what you've got right now, where you're at, and it's enough to get your first or your next client. Okay. When I first released my Money Bootcamp, the first version of it was recorded on my iPad, propped up on my ironing board. The next version, I hired one guy with a camera. The next version, it was a team, and then it just got progressively better, but you have to start where you're at right now. And so if you think, "Oh, I need to spend five grand on my first website." You absolutely don't.

You can start right now, but embrace imperfection. It does the job. Get your message out into the world and move on. Okay. Don't procrasti-brand anymore. Tip number two, before you spend a ton of money, practice the incremental upgrade. Now, I talk about this a lot in Money Bootcamp, how you can acclimatize yourself to a richer life by incrementally upgrading the things all around you. Now, there's a good reason for this, right? Big leaps, big quantum leaps can happen. But most of the time, you're going to grow consistently, and not by fixing everything at once and making everything perfect all at once, but by actually just doing things incrementally, so you can take baby steps. You might be thinking, "Oh, I need to hire someone to do this sales page for me." Okay. Here's a tip on sales pages. You write, "Hey, I've got this thing."

And then you do another line, "Here's where you can buy this thing." And you'll link to PayPal or you link to your shopping cart. You do that, you've got a sales page, and then you can add to it later on. You can incrementally make it better. But, just offer something to somebody with what you've got right now and upgrade each time, and then that way, you fund your business from your customers, from your profit, not from your credit card. Also sometimes I find people, they spend a bunch of money on branding or website or stuff like that, and they haven't really, truly worked out what they want to offer in their business, and then it becomes obsolete very quickly because you're like, "Oh, that was a practice business. Oh, actually I don't really want to offer that anymore." And then you've spent the money and it's too late.

Okay. So think about what you can upgrade incrementally, what you can upgrade next. You don't need to go from something really budget to like something super expensive. Just upgrade it to that next, next level. Get in the trenches. Get a client. See if you like it. The reason I say that is because, before I had kids, my mom would say, "How many kids do you want?" And I go, "Wow. Maybe like six kids, four kids." And she'd go, "How about you have one and see if you like it?" And I go, "Okay." And now, I say that to people with their business. I go, "Get a client. See if you like it. Tweak accordingly." Because you just sometimes don't know, and that's why that second tip of practicing the incremental upgrade is good. Okay. Tip number three, invest in things that bring in clients and money first.

Okay. So if you're looking at two business investments and you're going, "Huh, okay. So this one is a new website or this one is a course." Pick the one that is going to have the quickest and easiest return, and that usually means the one that directly helps you to bring in more clients. An example of this might be spending a ton of money on branding versus spending money on getting someone to finish your course and have it out to market. Sometimes you need someone to help you start things. Sometimes you need to pay someone to help you finish things. And often entrepreneurs, actually it's about finishing things rather than starting things. So for example, if you haven't sold your course yet, it's not out to market, then I wouldn't spend a ton of money on the logo for the course, because that could change over time on making it really, really sexy.

All of those things are great to have, even though, I still think mine could be improved, but they won't necessarily bring the clients in. They won't necessarily help you to finish your course. So when you're looking at those investments, what is going to be income-producing activities? And then you can park the other stuff for later, for the future, when you can fund it from your clients. Okay. All right. Tip number four is maybe you can budget in other areas. So, you could temporarily cut back on other things to free up funds to grow your business. So it might be actually things in your personal life. Like in my first couple of years of business, I didn't really go on big, splashy holidays, because I really wanted to fund my business and spend time on growing my business, and that has paid off many, many times over. Now we can afford to go business class and do amazing, big holidays, because I cut back in some of the personal stuff early on. Now I'm not saying, "Be a martyr."

I'm not saying, "Live on a [lentil] for a long time." But maybe this year, you skip some of your personal expenses to fund and create an asset for the future that could pay off for years and years and years and years to come. It really could, and it really might be worth it. Now, don't do things that will... I don't know. When you're just like, "Oh well, then fine, I'll cut back on my cleaner," or "I won't have a cleaner anymore." No, that's not a good place to start, because then, you'll get super caught up in cleaning your own house instead of writing that book or finishing that course. So, be discerning in the areas that you cut back in, in order to fund your business, and that might be 100% worth it. Okay. Tip number five is to get into action.

Now you might think that you need to loan. You might think you need a credit card, but in reality, you could generate that money much quicker from your actual clients. So write down your big money goal, and then work out how many of your products or services you need to sell to hit that goal. Okay. How many clients does that take? As Seth Godin says, "Raise the money from your customers." Great. Well, how many customers do you need? How many widgets do you need to sell to fund that, instead of getting that credit card. Now I've been tempted to do it in the past, but you know what I did really early on? I was actually rejected from getting a credit card in my first year of business. So I just made that commitment that I would pay for things in cash.

And so I always use my currency, and how many Bootcamps do I need to sell? So I'd go, "Oh, I really want to do that course. Oh, I really want to go on that conference." How many of those things do I need to sell? So I'd go, "Okay, well that's four bootcamps." All right. How am I going to sell four bootcamps this week to make that happen? And honestly, of course, that's going to grow your business so much more, because you take out the option. You don't give yourself an out. You have to get into action and kind of do it. So to recap those tips, you have to embrace imperfection. So just start where you're at with what you've got. Practice the incremental upgrade. So just upgrade those things a little bit at a time. Nothing has to be perfect. You don't need to make those big leaps necessarily. Invest in things that bring in the clients and the money first. Focus on those income-producing activities. Budget in other areas.

So maybe in your personal life, maybe you direct that money to your business instead, and then you get into action. Now that's only five tips. So I'm actually going to give you one other tip after the break about how you can create income on a regular basis. We're talking about passive income, but we're going to talk about all the reasons why you could be resisting that. And that sometimes is just that buffer that you need, so you don't have to go through those feast or famine cycles, and you don't have to get into debt when you want to grow your business. All right, gorgeous. It's going to be super juicy. I'll see you after the break.

Hi, my name is Martha Clarke. I'm an astrologer and an astrocartographer, and I live in [inaudible] Ireland. I've been reading Denise's books for five years now, and her recent one Chillpreneur has really, really inspired me. It's inspired me to stop under-charging. It's inspired me to stop people-pleasing. And the biggest change it's made is that I have delegated out absolutely everything that I don't like doing. That's been life-changing. I highly recommend Denise's books to everyone. Thanks a lot.

Hi, Denise, and all you lovely listeners. My name is Meliss and I'm the founder of mellismarketing.com. I have a program for healers called Marketing With Intention, and the first thing we do in our program is a mantra, and we read an excerpt from a book. And on several occasions, I use the book Get Rich, Lucky Bitch! and Chillpreneur, because both of these illustrate so wonderfully how amazing it is to manifest money in an easy and fun way. I love Denise's stories throughout both of these books, and I highly recommend them to all of my clients.

All right, gorgeous. Welcome back. Okay. So we were talking about all those ways that you can make money in your business without going into debt, without using your credit card, et cetera, et cetera. Now, actually, what really helped me in the early days of my business was creating passive income assets. So then, I didn't have to go into debt. I didn't have to use my credit card to fund things, because I was always making money, even though it was only teeny tiny amounts at the start. It meant that also, not only did I have to not go into debt, but I also could be way more discerning about the clients that I took on. I didn't have to say yes to every client. I could say no if I saw red flags. I could have the courage to ask for what I was worth for speaking gigs and things like that, because I had that buffer of passive income.

But what I really want to talk about in this segment is why you might be resisting either creating or growing passive income in the first place. So first of all, what is passive income? Passive income is money that you can make from things that you've already created. So in the traditional sense, that used to be royalties. So, writers receive royalties from books they've already written, songwriters from songs, artists and things from movies and things that you've already done. And it was always kind of hard for just normal people like you and I to create passive income, because a lot of those assets were often bought by big companies, and the gatekeepers that be could deem you ready or worthy of making that. Now, in a traditional world as well, passive income is a very teeny, tiny amount of the overall value.

So for example, I might only make 15% royalties on the books that I create. But, now that we have technology to support us, it's the best time for you to control and create your own assets. Now, you might have assets outside of your business. You might get rental income from a property that you own or dividends from shares or from a company that you might be a director in. But, you can start right now creating passive income assets that you can profit from again and again, and you won't resist the crap out of it. Okay? So, you can create an ebook, a meditation, a course, a resource, a spreadsheet, something like that, that people will get value from, and they will pay you.

That sounds amazing. Why do people resist it? Well, let's talk about it. Let's talk about it. One of the reasons why you might resist it is because we have a fetish in the world around working hard for money. We are told, "You have to hustle," and that, "You don't get something for nothing." So suddenly, passive income goes against that grain of hard work. Why should you get paid for something that you already made? It doesn't compute. It doesn't have a one-to-one relationship. You didn't quote unquote, earn it. Now, my very first passive income stuff that I ever created was ebooks. I did a whole episode on this, about all the ebooks I've created.

My first one was internet dating tips for men in 2004. I did a wedding guide in 2008. I wrote my first book Lucky Bitch in 2011, Get Rich, Lucky Bitch in 2012. They were my first, kind of, passive income forays, and I didn't make a ton of money from them, but I would make a couple of dollars here and there. But it actually made me feel really, really, really guilty, because I could understand when I started my business as a coach, someone would pay me for an coaching hour and I would get paid for a coaching hour.

But, when I started making money from books that I'd already created, I felt incredibly guilty. I felt like I had to call them up and read it to them over the phone to earn that money, because it was weird. It was like, "But, I already did that." And I don't understand why I'm still getting paid for it, and that's... You might just be like, "What is she even talking about?" Okay, cool. This episode might not be for you because you're already over your passive income blocks. But if you're still listening and you have this, see where it's showing up for you at the moment. Maybe you feel guilty about creating a group coaching program because you feel like, "Oh, it doesn't count if I'm not doing a one-to-one relationship with somebody." Maybe you're resisting creating a resource that people ask you for all the time, but you think, "Oh, I can't charge people for that. That's so easy. I just knocked that up in five minutes. Why should I get paid for that?"

Or maybe you're really discounting your skills and talents and you think, "But everybody knows how to do this. Why would they pay me to do it?" You know what? It's okay if you get paid for something that you've created once. It's okay for you to get paid for something that's fun and easy for you to create. It's okay for you get paid for something that you've curated, even though somebody could technically find that all information for free. It's okay for you to add value to people's lives and to save them time and money and effort, and to get paid for that. It's okay to leverage your skills and talents. But you're going to feel like you're cheating. You're going to feel like you're maybe taking advantage.

You feel like it's not worthy of being paid for. And you're generally going to resist it because of your relationship to working hard. Your family might've said, "You don't get something for nothing." "There's no such thing as a money tree." Or they might have mocked people for making money easily as being cheaters or scam artists, and that's what we all have to get over. We all have to get over this feeling that you have to work really hard all the time to make money. I also think there's some cultural stuff around this as well. I grew up in Australia, and we've got this fetish around working hard, but in a real working class kind of way. It's like, "Yeah, good, honest work." You have to sweat, and then you get paid for it. A good day's work for a good day's pay.

And you can't be seen to be enjoying your work too much, or it coming too easily or being too ambitious for it. So that's kind of Australian culture. You might've grown up in America, and that's like a real hustle culture. There's all nuances within that too. Right? New York culture would be very different from Ohio work hard culture. And so, as you're working through your resistance around passive income, reflect on how you grew up and what you were told about working hard. You might've come from real working class background, and you feel guilty making money doing something that's fun and easy for you. You might've come from a background where your parents worked really hard because they were lawyers or doctors. And again, you feel like it's really inappropriate for you to be making passive income out of something that you just knocked up because it was fun and easy for you.

It's normal to have really complex feelings about money. It's so adorable. And I didn't even cover anything in Europe, right? So, it might be that there's some British skepticism around passive income. Oh, it feels all very American and a bit scam artist-y. Okay. So we've all got our own stuff when it comes to working hard. And I would say too, that we have some generational stuff around working hard. My kids, they think it's easy to have a book. My daughter's like, "So I've written this five-page book, can we go to the bookshop and tell them that they have to sell it now?" And I'm like, "Okay." She's like, "Can we just make copies and we'll go to that bookshop where your book's there? Because they obviously just sell books from anyone. So, I really want to make money out of my book."

And I'm like, "Okay." Because they just see that that's really easy. They see kids who make money on YouTube opening toys and just playing with toys all day. So, our kids are going to have a very different view about what work is, and that's great. I'm so happy that they say that. Recently for Valentine's Day, Mark bought each of our kids one Disney share. One Disney share, right? And we told Willow, and she's like, "Oh, that's great." And we said, "Yes. So if Disney do really well, then you make a teeny tiny bit of money out of it." And so she's like, "So every time Disney makes a movie, I make money from it?" And we're like, "Technically, I guess." And so she's like, "Well, they should just make more movies. Great. Does anyone want to watch some of my movies?"

Like she just sees it's so easy to make money. Easy and fun and abundant and joyful. Okay. So I'm in my 40s. When I grew up, making money was about going to work and exchanging an hour of your time for an hour of pay. That's all it was. I never saw examples of people who could leverage that, or if they did, it was because they were really rich in the first place. So I want you to reflect even just the generational blocks that you might have around the fact that making money could be easy and fun and joyful. We grew up with an analog childhood, and I didn't even have a cell phone, a mobile phone until I was 19. Not only that, a lot of the ways that I make money now didn't exist for me.

They didn't exist at all for any of us. Making money, being able to curate something and sell a solution to someone, it just did not exist. So your brain hasn't quite caught up with the fact that it could be fun, easy, and enjoyable for you. Okay. So respect your journey. You might be at the start of your money blocks journey. You might've been listening to me for years and that's totally fine. And it probably means that you've got some inner work to do around this stuff, whether it is making money out of something that you love, getting into action in your business or creating your first passive income. So if that is you, I talk a lot about passive income in my books. I would suggest that you go and read my book Chillpreneur. It not only talks about creating passive income and some practical ways to do it, but also the mindset work that you need to do to give yourself permission to make money in a business that is not only fun and profitable, but actually really easy for you to find the path of least resistance.

Okay. So I'm running out of time a little bit, but I just want to share some of my early passive income sources. As I said, my books, I felt really guilty about that. My first passive income course was a $50-e-course about setting your goals. I created it on an iPad, and the first time that someone buys something that you've created like that... I woke up and I was like, "Oh my God, someone that I've never met paid me $50." It felt amazing, and yes, it brought up all my blocks. And then from then on, I created a manifesting course, and pretty soon that was making... I remember it was making like a $1,000 a month and then $5,000 a month then $10,000 a month, and at its peak, before I let it go, it was making $25,000 a month.

That is life-changing money by creating something that owes a value for people and just making it available. Just telling people what I had to offer, and it was helping people each and every day. And now, people joined my Money Bootcamp each and every day. I wake up and someone has joined my money bootcamp, and it's amazing. And, you might think that the value is not there, with that one-to-one relationship, but it is. Somebody needs to hear your voice. They need to hear your message. They need your solution right now, and the first thing you can do is just give it to them, and you can complicate it later. And as I said, if that brings up stuff, you come and join us in Money Bootcamp. It's a lesson that so many of us have to get over, but it really is your time to get over that. All right. I will see if you with my final thoughts in just a few, after this break.

Hello, I'm Mariam from [inaudible] in New Zealand. I read Get Rich, Lucky Bitch about eight years ago, and Chillpreneur more recently. I read them, listen to them and take huge amounts of notes on a regular basis, because the entire content is just so valuable, and I know you'll find it invaluable too. Decluttering as the biggest standout for me. Mariam is hopeless with money. Mariam is lazy. You'll never make any money teaching speech. And then using that great mantra from Get Rich, Lucky Bitch to declutter all that away. Go get those books.

Hi, everybody. My name is Natalie and I live in the UK. Reading Get Rich made me realize I had been treating myself cheaply all my life. I always went to low-pay jobs because I didn't feel I was worth more. It was so beneficial to spend time analyzing my money blocks, where they're starting from, and why I hadn't challenged them up until then. I've also read Denise's Chillpreneur because I'm interested in entrepreneurship. One of the things that I took away from it is that you don't have to be an expert to run your own business. Be a contributor, not a guru. That phrase really had an impact on me. Thank you, Denise.

Hey, gorgeous. Welcome back. Thanks for being with me today. And here's my final thought for today. It is such a simple affirmation. You've probably seen it a million times, but I really want you to do it over the next couple of days, and it is the affirmation, "I am a money magnet. I'm a money magnet." Just see where this is going to be true for you today. So it could be opportunities that come up into your head. It could be things that come in your inbox. It could be clients asking to work with you, or it could literally be a coin in a street. Now in my money bootcamp, we celebrate everything, and I really encourage people to celebrate those little things as much as the big things, because it is true. You are money magnet.

And I find this happens to me in really weird situations sometimes, that I'll meet someone, they say, "Oh wow, Denise. I really liked your book, and thank you so much." And it's happened to me about four times where I've gone, "Thanks." And I've walked away, and money has just fallen from the sky. And people go, "Oh, is this money yours?" And I go, "I don't know." And they just laugh because it just proves to them that I'm the money magnet and they go, "Oh, wow, cool. It's all right for Denise." But I want you to try this for yourself. "I am a money magnet." And if you see a coin in the street, if you feel gross about picking it up, that's fine. You can just take a picture of it and send it to me, but pick it up and just say, "Thank you, universe, and I'm here for more. More of this, please. More of this." And see what happens.

This is a really fun one if you've got kids too, because Willow is convinced that she is a money magnet. And sometimes, it's because I've seen the money first, and I'll try and call it to her attention, then I go, "Oh my God, Willow. You're such a money magnet." And this is a really fun thing to teach to kids at an early age, that they can attract money when they need to, or when they want to, or it's just fun. You can have a competition to see who could find the most amount of money. Yeah. It could be really fun. So I am a money magnet. Give it a go and send me a message and let me know what you're attracting in the next couple of days. All right, gorgeous. Go forward, chill and prosper. Peace out for me, and I will see you on the next episode. Bye.

About the Show

Chill & Prosper is your weekly dose of money mindset, marketing and humour from best-selling author and entrepreneur Denise Duffield-Thomas.

Denise's philosophy is that there is ALWAYS an easier way to make money and that's what she's here to help you do. Each week, you'll get actionable advice to help you make more money, with less work. There's no need to hustle - let Denise show you how to embrace the Chillpreneur way.

Be sure to hit subscribe so you don't miss an episode!