Today, I’m going to explain on how Meri and I are attempting to resolve a paradox. In Meri’s first blog post, she talked about how we came to the decision to travel. To summarize; we were bored and stuck in a rut, and after much soul searching we decided to put family, fun and adventure before money and careers. Perhaps it was a mid-life crisis, but we refused to endure through careers that we didn’t enjoy to save for a retirement that may never come. So, we made a list of everything we each wanted out of life and a common theme emerged. We figured out that traveling to fully experience other cultures and surroundings was what we really wanted to do. I don’t mean taking a vacation to an exotic destination here and there. We wanted to experience what it was like to live amongst different cultures, explore the landscapes, know the people, cook the food, contribute to their societies. We wanted this for our children too. Understanding the world from different perspectives, not to mention having a lot of fun along the way, would be a tremendously valuable experience in terms of personal growth for such young minds (more of that in a future post).
But here’s the paradox. Travel, at least the sort of global travel that we have in mind, takes money. Particularly for a family of five, and for the length of time that we plan to enjoy it. We couldn’t just save up for this, or we would possibly never reach our goal. We would need to earn enough along the way to fund the adventure. The snag is that for most of us, income means a career, and careers come with many strings attached. You often need to work in a specific location, or at the very least be willing to travel whenever your employer needs you to. Being stuck in one place or being required to travel for business at any time really gets in the way of travel-based adventures! As does the lack of vacation time when you need it. So, just how could we fund a travel-centric lifestyle if traveling is seemingly incompatible with our means of income?
The Solution Was in the Cloud
Depending on your skills and experience, there are of course a number of potential answers. Some might choose to find jobs along the way, working in the tourism industry for example. Spending my days as a dive master or ski instructor sounds like a wonderful life… if I was in my 20’s without a wife and three children to consider. I wish I’d donned a backpack and travelled the world for a year or two when I was younger, which is probably fueling my desire to travel now. It’s a lot more complicated these days, with a larger income requirement and other considerations such as ensuring that the kids are safe and receive a good education. Surely though, where there is a will, there is a way?
We considered IT and business consulting, both of which I have done in the past, but consulting of any kind means working to someone else’s deadlines and usually involves working close to your client at least some of the time. This would restrict our travel in terms of both location and timing, and travel restrictions of any kind were our new enemy. Sure, it is sometimes possible to work remotely for certain types of professional services contracts (e.g. software development, web marketing or graphic design), but we don’t have enough current skills or experience in this type of work. Plus, we’ve been there and done that already. Time for a change.
Some people talk of building a passive income; an income that grows on its own with almost no work required. It is completely possible to do this – if you have enough capital to start with. Got a few million spare? Just put it into a diversified portfolio and live off the profits. If you don’t have that much (and we don’t!) then actively investing in financial instruments (read: higher risk, higher reward) is a possibility. We considered swing trading the stock market, but having already tried that a few years ago we knew that it takes up a lot of time, as you need to be constantly watching the market, and it can be very stressful. Not to mention, it can be very hit or miss. That’s not the kind of freedom we were seeking. Investing in rental properties is something that we have seen friends and family have some success in, but we have also seen that in the early years it takes close management as you build a portfolio of property and trusted agents – and we wanted to travel now, while the kids are young enough that education doesn’t completely get in the way.
To have a career that works now on our terms – where we want, and when we want – we decided to build a business that we could operate from anywhere. Something that I call a cloud-based business. In computing, the cloud just refers to a bunch of servers and storage running in some unspecified physical location(s) with someone else looking after their day-to-day operation, but with you utilizing them from wherever you want over the Internet. This is the perfect analogy for how we wanted to design our business. A business whose physical location didn’t matter, from our perspective of managing it, and with other people taking care of most physical processes so that we could be wherever we wanted – so long as we had Internet access.
So, we knew that it needed to be cloud-based, but what should this business do to make money? At their core, most businesses sell products or services to customers, and those which aspire to be successful enough to fund a global travel adventure for a family of five probably need employees, too. It’s often best to be close to your customers, close to your employees, and if you’re handling physical products you usually need to be close to those, as well. Our business would have to allow us to be anywhere – it was a founding principle, higher in importance even than profit. Of course, we’d need to make enough money to get by, but we couldn’t sacrifice our freedom of travel.
We would first need to identify the right type of business, and then design all of it’s processes to work regardless of where in the world Meri and I happened to be. We also needed our working hours and vacation time to be flexible. We wanted to spend more time with the kids and enjoy the adventure. Why travel if you don’t have time to stop and smell the roses? It was a lot to ask, but one solution jumped out at us.
A Business Custom-Built to Allow Travel
We decided to start an e-retail business. Selling over the Internet would mean that we wouldn’t have to be physically close to our customers. They could be anywhere in the world – and if they could, so could we. And what would we sell? The Internet is a very competitive place, with other e-retailers just a click away. Unless we wanted to get involved in price wars (which, these days, is an industry of its own), we’d need to sell products or services with low competition but for which there was still a large enough market. If you sell anything, it is vital to know your products and your market. Meri has a very good eye for design, and has been asked on many occasions to do interior design projects. Whereas that line of work would be hard to manage while traveling, she could leverage those skills to find and manufacture unique new products to sell. So, we decided to sell a class of products that everyone buys to some degree; home décor. To address competition, we would import products that are not currently for sale in our target market – the US. This was the icing on the cake. To find these products, travel would be compulsory. We could make work part of the adventure!
What about employees? It would be just us to start with, but we’d want the business to grow and that would eventually require help. We couldn’t manage or train a team well if we were always travelling, so the answer was to outsource everything. Well, as much as we could justify not doing ourselves. This would substantially eat into our profits, but if we managed it carefully, we believed that we could make it work. We would just have to sell more. That would require more employees and infrastructure – so we had better plan from the very beginning for the business to be easily scalable.
And the infrastructure? Products would need to be received, processed, stored and shipped to and from customers. Again, the answer was to outsource. There are businesses set up to do this.
So, this was our bare-bones plan. We’d start a home décor import and e-retail business, and outsource whatever we couldn’t do ourselves. We came up with the plan in September 2014, and in October had placed our first product orders. We have been working hard for the last year and a half to get all of the processes in place that will allow us to travel for as long as we want. In April of this year we completed the final major milestone, with the completion of a project to implement a third-party logistics partner to physically store and process our products. While we still have a base in Colorado, we are now free to be wherever we want and in June we landed back in Bali, Indonesia. Profits large enough to live off of may still be a few years away, but we now have the processes and infrastructure to grow into that position. Let the adventure begin!
In a future post, I’ll talk about some of the practicalities of running a cloud-based business. What are the services, systems and processes we are using to make this dream a reality?