Tuesday, Dec 3, 2019 • 33min
Chasing Money vs. Chasing Your Passion
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For many women, starting a business is a way to follow a passion while leaving an uninspiring career behind. But a business can’t survive on passion alone. Whatever you’re selling, whether it’s hiking retreats or hand-knit blankets, you need to figure out a business model and a financial plan. Here’s how to get started.
Expert: Ashley Feinstein Gerstley
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Talking about
Speakers
(3)
Samantha Barry
Caroline Hinchliffe
Ashley Feinstein Gerstley
Transcript
Verified
Break
Samantha Barry
00:31
She Makes Money Moves is a production of
Glamour
and iHeart Radio
.Share
Caroline Hinchliffe
00:39
'I've been trying to live by the advice of "do what you love and the money will follow. I'm definitely doing what I love, but so far the money hasn't followed.
Share
Samantha Barry
00:51
I'm
Samantha Barry
, the editor in chief of Glamour
and this is She Makes Money Moves.Share
00:56
40% of entrepreneurs are women. Some of those women leave traditional 9-5 jobs because they want a flexible schedule. Others start a business so they can be their own boss. But for many, starting a business is a way to follow a passion while leaving an uninspiring career behind.
Share
01:20
When today's guest left her job in 2014 to hike
the Pacific Crest Trail
, she was transformed by the experience. She started a business inspired by that trip but she's struggling to grow it and has to take on side jobs to get by. This is her story.Share
Caroline Hinchliffe
01:40
I'm Caroline Hinchliffe, I'm 36, I live in
White Salmon
, Washington
and I'm the founder of a business called Eat, Hike, Love, which connects women with food, nature and each other. I love what I do and I'm so passionate about it. But the money hasn't really shown up for me yet.Share
Samantha Barry
01:59
Some women have always wanted to be entrepreneurs. Caroline was not one of them.
Share
Caroline Hinchliffe
02:05
I never actually wanted to own my own business. I worked during my 20's in a lot of different jobs in hospitality and tourism and I started thinking maybe I want more of a "real job", an office job or a sales job, or something that I can tell other adults about and they'll say to me, "Oh good, you're doing it right, you're following the path that most people are supposed to follow".
Share
Samantha Barry
02:27
By 2014 Caroline was working at a software company earning $65,000 a year. She was in a management role with a steady upward trajectory. But despite all of her outward career success, Caroline was struggling internally as she approached her 30th birthday.
Share
Caroline Hinchliffe
02:46
I was having a really hard time going to work in the morning, I was having a lot of anxiety during my morning commute. And while I was there, I constantly found myself looking out the window and daydreaming and feeling like something was wrong. I was sitting in this desk chair staring at this computer and I felt like I needed to be somewhere else.
Share
03:06
My performance didn't go down at work, but I slowly, steadily started to mentally check out. So I started asking big questions about who I was and what I was doing and why I was doing it, couldn't answer any of those questions. I started to realize that I didn't really know myself and I didn't really like myself.
Share
Samantha Barry
03:30
Around that time, Caroline's dad told her about a book that he, Oprah and a few million other people had just read:
Cheryl Strayed's
memoir "Wild". If you missed the book and the movie, which starred Reese Witherspoon
, Wild tells the story of Strayed's
divorce, her mother's untimely death, and the 1100 mile hike she took along the Pacific Crest Trail
that helped heal the wounds from both.Share
Caroline Hinchliffe
03:56
And he said to me, "Caroline, this woman was facing much bigger challenges than what you're facing and she got through it, and if she can get through it, you can get through it". He certainly didn't think that I would ever consider hiking the trail, and I had never even heard of it until then. I think he just thought I would find inspiration in her story.
Share
04:16
And months went by I thought about it once or twice. But one day I was at a coffee shop and I just started crying and I had this overwhelming realization that I really wanted to hike the trail and I was terrified because I wasn't a big hiker, I'd never been backpacking before. But I just had this feeling that I had to leave everything I knew behind because whatever I was doing wasn't working.
Share
Samantha Barry
04:42
The Pacific Crest Trail
spans 2650 miles across California,
Oregon
and Washington
state. Caroline
wanted to follow Strayed's
footsteps along it. She threw herself into research. Hiking the entire trail would take five months and cost somewhere between $5,000 and $10,000. She already had $5,000 in savings, but she needed more time to save the rest and prepare herself physically. She gave her boss six months' notice.Share
Caroline Hinchliffe
05:14
My boss said okay, but the very next day when I went into work, he called me into his office and he offered me a $10,000 raise, a promotion and a month of paid vacation to hike part of the trail if I would stay in the job instead of leaving to hike the entire trail.
Share
05:32
I was floored. I went home that evening and cried and cried. I couldn't believe that I had to make a decision between what my heart wanted to do and an offer from him that was too good to refuse. I thought I would be stupid to say no to this.
Share
Samantha Barry
05:47
Caroline accepted her boss's offer, but she felt uneasy with her decision. Four months later, when the hiking season began, she had reached a breaking point.
Share
Caroline Hinchliffe
05:57
I was commuting one morning, I was sitting in gridlock traffic, it was a beautiful
Seattle
day and I could look to the east and see mountains sparkling and I could look to the west and see mountains over there, my heart just dropped.Share
06:09
I had this moment on the freeway where I realized I made the wrong decision. I chose money over my heart. I chose money over my passion. I chose money over figuring out who I really am and what's important to me. I made the wrong choice. I have to quit this job.
Share
Samantha Barry
06:24
When Caroline finally got to work, she gave her two weeks notice.
Share
Caroline Hinchliffe
06:28
I was worried that my boss would be angry with me, I was worried he'd be disappointed or upset, but he simply nodded and said, "You've got to do what you gotta do, and if you want a job when you get home, it'll be waiting for you".
Share
Samantha Barry
06:43
15 days later she hit the trail. To save money, Caroline gave up her apartment so she wouldn't have to pay rent while she was hiking. The $5,000 she had in the bank would need to cover her hiking expenses and the payments on her cellphone and student loans, which she had automated.
Share
07:02
It turns out her savings weren't enough. By the time Caroline had arrived at the northern territory of the trail, she had ran out of money.
Share
Caroline Hinchliffe
07:10
I knew that I had a choice. I could quit the hike and go back home and go back to work, or I could finish the hike somehow. And at that point it felt so important for me to finish the hike that I put a lot of my remaining expenses on a credit card. So on top of the debt that was already on the card, I added about 2000 more dollars.
Share
Samantha Barry
07:30
When she returned home after the hike, Caroline was anxious about money and eager to have a steady income. She moved in with her parents in
Seattle
and returned to her software job. Earning money, gave her a sense of comfort, but it didn't last long.Share
Caroline Hinchliffe
07:46
The anxiety that I'd felt before I left for the hike had increased tenfold. I hated going to work, I felt like something was wrong, I felt like I shouldn't be there. My heart did not want to be there, my soul did not want to be there. So before I had a chance to pay off the debt from the hike or to replenish my savings, I ended up quitting and deciding to move to
Portland
and go to graduate school.Share
Samantha Barry
08:12
Caroline's decision to return to school and study naturopathic and holistic nutrition was inspired by a hike on
the Pacific Crest Trail
.Share
Caroline Hinchliffe
08:20
Before the hike, I struggled with food and body image for more than 17 years, and I wasn't getting better. I was in and out of an eating disorder and constantly struggling to feel good about myself, what I was eating, my body.
Share
08:36
And on my hike for the first time in my teen and adult life, I felt good about my body, I felt confident about what I was doing and what I looked like. I healed my relationship with food, I was able to finally listen to my body's signals for the first time and to honor them and to let go of an attachment to external circumstances.
Share
08:58
I realized for the first time that it didn't really matter what shape or size I was, all that mattered was that I was feeling good and taking care of myself. And when I came home from the hike I wanted to keep that confidence. I wanted to learn more about food and our bodies, specifically to help other women go through a similar transformation.
Share
Samantha Barry
09:21
More on She Makes Money Moves right after this quick break.
Share
Break
Samantha Barry
10:26
I'm
Samantha Barry
, welcome back to She Makes Money Moves.Share
10:30
Caroline moved to
Portland
with $400 in savings. She needed to cover graduate school tuition and living expenses. So she took out $60,000 in student loans. She was concerned about the financial commitment but assumed she would have a good career options when she graduated.Share
Caroline Hinchliffe
10:50
I wanted to get a job and I applied for jobs in
Portland
and jobs in Seattle,
and I had some success with those applications. I was interviewed for many jobs and actually for a few of them, I got into the final round where it was me and one other person. And after all that, I ended up being told you did really well, but we hired the other person.Share
11:12
And after a few experiences like this, I was pretty crestfallen. I just started to feel like I was at bit of a dead end, nothing I was trying was working out. And that's when it occurred to me, "Maybe I need to forge my own path".
Share
11:27
The idea for starting my business Eat, Hike, Love, began when people told me over and over how inspired they were by my story, the way that I left a life that wasn't serving me and pursued a life of health and freedom. And I started to realize that everything I'd learned over the years about food and time spent in nature and self-care, that I could teach others.
Share
Speaker 4
11:56
And since I wasn't having success getting a regular job anyway, I thought, "Why don't I turn this into a business? Why don't I see if I can start doing some nutrition coaching through my own business? Start leading events where we go as groups of women into the wilderness to experience the benefits they're together?"
Share
Samantha Barry
12:16
In the summer of 2017, Caroline led her first women's retreat with a group of friends and was encouraged by the positive feedback. She continued to work in the hospitality industry so she could support herself and invest in her business, Eat, Hike, Love.
Share
Caroline Hinchliffe
12:32
It was not something that I was able to plan for very far into the future, because I was pretty much living paycheck to paycheck. And again, just hoping that it would all work out with the money that I had.
Share
Samantha Barry
12:45
The business is slowly gaining traction. She led two retreats for Eat, Hike, Love in 2018 and five in 2019. Caroline is making some money from the business, but not nearly enough to live on.
Share
Caroline Hinchliffe
12:59
My first year, I made $1,500. This year, I'm on track to make close to $9,000. So I know I'm doing something right, but obviously $9,000 doesn't come close to creating an annual income that I can live on. So in the meantime, I'm still waiting tables and it's fine.
Share
13:20
It's a hard job in that the more time I spend waiting tables, the less energy I have to build my own business. So I have to be careful that I don't work too much in the restaurant or I don't have the energy left to work on Eat, Hike, Love. So I've supplemented with a couple of other things too. I work at a local winery, sometimes helping them do their bottling or picking grapes and I do a lot of pet sitting.
Share
Samantha Barry
13:41
Caroline knows she's fortunate. She hasn't been able to build up savings, but when unexpected expenses pop up, her parents and her boyfriend are able to help. She pays them back, but at 36 she'd prefer to be financially independent. For Caroline that would mean $4,000 to $5,000 a month versus the $2000 to $3000 she's currently making.
Share
14:04
She could charge more for her services, which range from $150 to $600, but she also wants to remain affordable. Caroline's happy with the path she's chosen, but her money struggles often make her wonder if she's done the right thing.
Share
Caroline Hinchliffe
14:20
I've been trying to live by the advice of "Do what you love and the money will follow". I'm definitely doing what I love, but so far the money hasn't followed. At least once a month I have a moment or a day where I think "I've had enough, I can't live like this anymore. This financial stresses is too hard. I'm just going to go back to the way I was before, I'm just going to get a job. I'm going to go work in an office 9 to 5 and I'm going to suck it up and just make it happen."
Share
14:48
And I do go online and I start looking for jobs and I think I could do that, I could do that, I could do that. But after about 30 or 45 minutes of looking at online job postings, I find myself heartbroken, in tears. And I think about the women who I've met so far on my retreats and the women who I've coached with food and nutrition, and I think about how it would feel to walk away from everything that I've built so far.
Share
15:14
This business hasn't really been able to support me financially, but I know I'm making an impact. It feels good to me and it feels good to my clients. And so, at the end of the day, I'm not really ready to go back to the 9 to 5. I feel like I owe this business more of my energy and more time. I really want it to keep growing. I think I'm on the right track, but I'm not very patient. I want it to happen faster than it's happening.
Share
15:41
I don't want to worry about money anymore, it's exhausting and it's emotionally taxing. I want to know that if my car breaks down, I have the money to fix it. I don't want to have to wait tables in the evenings, I want to do so much more with my life, instead of constantly worrying whether I'm going to be able to make it and hoping that it all works out.
Share
16:02
I want to have more confidence knowing that it is working out and that I'm taking steps to make sure it does. I'd love some advice around staying positive, staying focused on the long term goal instead of getting worried about financial troubles in the present moment.
Share
Samantha Barry
16:24
Today's expert knows what it's like to leave a steady paycheck to pursue a passion.
Share
Ashley Feinstein Gerstley
16:34
Hi, I'm Ashley Feinstein Gerstle. I'm a money coach and founder of The Fiscal Femme, and the author of the 30-Day Money Cleanse.
Share
Samantha Barry
16:41
Okay, so Caroline, I mean, her passion just comes out in her story. I loved hearing about Eat, Hike, Love. But she's not in the best place financially. What stood out for you in Caroline's story?
Share
Ashley Feinstein Gerstley
16:53
So much of myself. I really related to Caroline's story. I built my business on the side while I was working and ended up having to, work full time on it before it was financially viable, and so I'm so excited about the work she's doing but I definitely feel her struggles, for sure.
Share
Samantha Barry
17:11
So, like Caroline, a lot of people listening to this will have passion projects that they might be doing not full time yet. But they're doing at the weekend, they're doing it in the evenings. What's the marker for when you can turn a passion project into a full-time job?
Share
Ashley Feinstein Gerstley
17:25
That's a really good question. So, it depends on the person. So for me, I'm a planner, and the more savings I had, the more comfortable I felt. In my corporate job I had a spreadsheet called Project Freedom, and every time I saved money I would add to my Project Freedom Fund and I knew, okay, based on my expenses, this is how long my business could last without me earning income.
Share
17:44
And so it felt really exciting to put money aside. You hear stories about people who quit with $500 and that really put a fire under them, and that's how they got started. But that's not, that doesn't work for me. It works for some people.
Share
17:58
So I think the biggest financial thing to plan for is to have savings, or some form of investment so that you have runway to not feel like you have to take on every project or have to say yes to everything and you can build your business more strategically the way you want.
Share
Samantha Barry
18:14
Your business model may change but you need to have one going into. If you're trying to turn your passion project to a full-time job, you have to start projecting. How does that actually become a business?
Share
Ashley Feinstein Gerstley
18:26
Yes and I think, so, having the number like Caroline has the $5000 mark, that's the goal. And then from there, the business model is essentially saying, what makes up that 5000? Does that mean that I have to have 10 clients? Does that mean that I have to have two retreats a year?
Share
18:41
And if I do, that's going to be big income in those two times a year that I want to make sure last over the rest of the year? So thinking about, okay, this is what I need, I want to earn and how do I actually earn that?
Share
Samantha Barry
18:54
More on She Makes Money Moves Right after this quick break.
Share
18:60
I'm
Samantha Barry
, welcome back to She Makes Money Moves. So how can Caroline grow her business into something that's more financially viable? What's your advice for her?Share
Ashley Feinstein Gerstley
19:10
I work with so many, and in my community there's so many like, badass, amazing women who have it all going on, and they're like, "But why can't I figure out this money stuff?" And so I hear Caroline saying that and we have a lot working against us. It's not something that we're educated about and you know, her background is not in creating this financial structure for her business.
Share
19:30
But I would say for Caroline, the biggest advice I would have is to look at her business model, especially in what she's charging rates for her hours, and for these retreats.
Share
Samantha Barry
19:43
I think she's undercharging for this, right? I think, when I dug through the numbers, I was like, "Caroline is not putting the right value on her business". And that's what it is, it's her business. And I think there is an undervaluation of what that looks like as an income.
Share
19:56
If you take into account, you should be taking into account, what does my healthcare cost me? What does my retirement fund cost me? What do true profits look like on this endeavor? I think she's undervaluing, right?
Share
Ashley Feinstein Gerstley
20:08
Yes. And I think there's this thing that we tend to do, is we imagine, okay, if I took that hourly rate and multiply it by every hour, but the amount of hours it takes for her to book the hour, to coach someone or to put together the retreat. I know she mentioned she wanted to have it be inclusive and accessible, but it benefits people when they pay, they show up differently when they invest in something.
Share
20:31
And if she doesn't make her business sustainable, she won't be able to do this and she won't be able to give her gifts to the world. So there are many reasons for her to charge more.
Share
Samantha Barry
20:41
And I've heard this from women in my life before, that have gone from full-time employment to doing something they really care about. And it just seems overwhelming to understand how much they should charge for an hour of their time.
Share
20:54
Is there any math we can have them to start thinking? Is there any resources where, if you're trying to understand what a truly profitable passion for you would look like, that you can start pricing that? Where should they go for that information?
Share
Ashley Feinstein Gerstley
21:07
So, I am a big fan of talking with people who are a couple of years ahead of you. They don't have to be someone who's your role model in life, you don't have to find
Beyonce
, but talk to somebody who's doing something similar and just a few years ahead. And then looking at it realistically, because how many hours will she be doing this? What does it take to run the business otherwise, so you can also map that out financially.Share
21:30
And sometimes it's hard to negotiate for ourselves or to think about how much I'm worth. But imagine that you're doing it for other women who are starting businesses and what you would say to your friend in the same position like, what her time is worth.
Share
Samantha Barry
21:44
Absolutely, Caroline, you should be charging more. And if you're worried about people not being able to afford your services, you can offer a discount for students or host a shorter retreat at a lower rate.
Share
21:56
It's great that you care about your customers, but you need to worry more about your own bottom line and less about their personal budgets. You can't be in the business of helping people if you can't actually afford to stay in business.
Share
Ashley Feinstein Gerstley
22:08
Maybe been creating a printable workbook or some, something that if someone came to her and doesn't have the funds, that she could point them to, that would be a really great resource. Then she can be more exclusive and get paid for the things that takes a lot of her time.
Share
Samantha Barry
22:20
Exactly. There are ways that she can help the people who can't afford her full services that don't involve selling herself short. Caroline loves hiking and the outdoors and food and nature and retreats that comes across.
Share
22:34
Is there other ways she can be making money through that passion? Maybe if she's a good writer, she could write for a travel publication? Maybe there's speaking engagements? I don't know if she has completely looked across the spectrum of what her passion could mean for diversified revenue.
Share
Ashley Feinstein Gerstley
22:51
I love that. And to focus on projects that she could make more money and charge more versus, I think, a natural tendency to want to say yes to everything and then we have no time.
Share
Samantha Barry
23:01
So it sounds like Caroline, in terms of finances at least, is quite stressed. What strategies can she use to stay motivated and positive and focus on her business in the long term?
Share
Ashley Feinstein Gerstley
23:11
It's interesting, we often think of having a financial plan as being restricting, but it often opens up so much more creativity because then you're not spending your time worrying about this. So, thinking about all of the things she's doing on the side to earn money, maybe there's something that you can do more consistently than it takes less.
Share
23:28
Because she's essentially running a lot of other businesses, by having the pet sitting business and the winery and the restaurant. So if there's one thing for her to get some steady income, that could be really helpful. So she can be freer to think more strategically about her business and less feeling that she has to say yes to everything.
Share
Samantha Barry
23:46
Maybe she could get a part-time job at a store that sells hiking equipment where she could meet women who are interested in hiking retreats and also earn a steady paycheck.
Share
Ashley Feinstein Gerstley
23:55
Yes, let's say that she works at the hike shop that has, it's a sustainable small business. So learning about how they maintain that business financially. So using it to also help with the things that she wants to learn more about. I love the idea of having it be a natural win-win for growing her business too.
Share
Samantha Barry
24:11
One of the things that Carolyn said in her story, which I'm sure many people listening arr guilty of, when big expenses of why she borrows from her parents or her living partner. That doesn't make her feel good about herself. but she knows she needs to get to 5 to 5k a month. So she can be independent and at least she has that number. But now it's the business and the financial model around it.
Share
Ashley Feinstein Gerstley
24:32
And it's so important to know that 5k number. I think you wake up in a very different way knowing that you have to hit 5K versus some amorphous thing that you're going after. So that's huge that she knows that number. And I would even think she might want to add a little too that just so that she can start building that buffer and set that-
Share
Samantha Barry
24:49
Aspirational goal.
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Ashley Feinstein Gerstley
24:50
Exactly.
Share
Samantha Barry
24:51
So as Caroline takes a look at her own business, what should she focus on? What's her first step?
Share
Ashley Feinstein Gerstley
24:57
So I think a financial model is something that I see a lot, especially people who are more creative, they don't sit down and map that out. So what it looks like, it can be very simple, but how I like to look at it is a month by month. So looking at the next 12 months, what do you expect to be coming in?
Share
25:12
And do it pretty conservatively. I tend to make these huge growth plans and that's great. But also what realistically will come in, so looking at, okay, I have this many clients right now, I can expect to get one new one every quarter, or however she sees it and then when she has her retreats, what the income is.
Share
25:30
So that's kind of how she looked at the top line and then all the expenses associated with the business for entrepreneurs. Anyway we can smooth out the volatility of our expenses is really helpful. So if she has a big annual subscription that throws her off, potentially putting money aside every month instead of once a year for that subscription. So anyway we can make the financial part easier for us is really helpful.
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Samantha Barry
25:54
How else can Caroline stay motivated through the ups and downs as she's growing her business?
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Ashley Feinstein Gerstley
25:59
So definitely to the ups and downs of entrepreneurship, one thing that I created was a tribe and it's a group of entrepreneurs. We're all in different areas, but we meet monthly and we support each other. Because sometimes your partner or your friends get sick of hearing about this.
Share
26:13
So it helps those other relationships to have people to lean on and to help you evaluate. Because it sets me back personally, if I'm always thinking is this the right decision. We get so in the weeds on it that it's helpful to have mentors and other entrepreneurs and our peers help us.
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Samantha Barry
26:30
Most people on the 9 to 5 career path have probably dreamed of stepping off to join
the Peace Corps
or the circus. Anything to get out. The good news is that you don't have to learn to be a trapeze artist to get away from a terrible job or a terrible boss. You can start your own business, but you can't become your own terrible boss.Share
26:52
Hopefully you'll never have to work for someone who's not paying you enough. If you're starting a business, you literally owe it to yourself to make sure that business can support you. Whatever you're selling, whether it's hiking retreats or handed blankets, you need to charge enough to sustain your business.
Share
27:12
You might not make enough in the first few years, but you need a clear cut plan to profitability. Otherwise you'll wind up back at a 9 to 5 job, feeling even more resentful. A business can't survive on passion alone. So figure out your business model and the financial plan, and find a community of entrepreneurs on and offline you can turn to when you need advice, support or motivation.
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Samantha Barry
Caroline Hinchliffe
Ashley Feinstein Gerstley