Imagine you love video games. You work to survive, of course, but ultimately, to buy and play video games. It’s not like you have any business aspirations involving gaming. You just love the experience of playing video games and chatting and interacting with others who do the same. What if we told you that doesn’t matter and that you need to have a business? The funny thing is, we all have businesses; we just don’t register as one. Put on your non-biased thinking cap, and let’s chat.
Death and Taxes
First things first, this is for capitalistic societies where tax laws are built around capitalistic tendencies (e.g., businesses). In these areas, it is to our disadvantage to not run a business. For those who hate taxes and are always using the death and taxes quote, we have to realize that, at least in the U.S., the original point was to push us all to somehow add to the economic ecosystem by performing ‘income-producing’ activities, e.g., run a business. If we perform these income-producing activities, we are helping the economy and also deducting from whatever income we would normally be making, hence reducing the amount of taxes we end up paying.
In a business, for example, hypothetically, all of its income could go right back into expenses to continue to produce income (or attempt to produce), and as such, have nothing left for income taxes. How the government would still make its money, of course, is through what we all know and love well: sales and property taxes, which are forms of consumption taxes.
But, if we look at general income tax brackets, we’ll see anything from 10% up to almost 40%. Imagine making one million dollars and having $400,000 shaved off the top for the taxman. Well, if we aren’t producing anything with all that money, the system is kind of saying, “If you don’t use it, we will.” Even as a gamer working at GameStop , bringing in $10,000 a year could benefit from not giving away 10% of the income earned. Who wouldn’t want to save $1,000?
Video Gamer != No Business
Great, so, we all can agree that having a business could save us up to 10% on our income taxes. But, how can a video gamer be a business? Well, first off, the easy analogy is Fortnite gamer, “Ninja.”
For those who don’t know Fortnite or haven’t heard of the gamer, Ninja, at one time, he made $500,000 a month in just Twitch donations. This was verifiable by just watching his streams where the donations could be seen rolling in.
Of course, we aren’t Ninja, and the chances of going that viral isn’t high at all. However, that doesn’t mean we can’t set everything up as a business anyway. If we live-stream on Twitch, it should be set up to accept gifts. Those gifts should be sent to the business. If we want to have sponsors, we should have sponsors pay the business. Whenever we purchase gaming-related items as a verifiable part of the business, it should also be purchased by the business.
Personal Brand + Consumer
Another term that may or may not induce vomiting at this point is “personal brand.” Love or hate the idea, we have to admit that GaryVee and many others are right: marketing has become available to everyone to an extreme extent because of our mobile devices and social media to the extent that now everyone is their own ‘personal brand,’ whether we decide to do anything with it or not.
Everyone has a personal brand, and as such, they have attention from others that can sell or be sold. That means we are all essentially tiny marketing businesses to large companies. We are no longer only consumers; we are both ‘brands’/’marketing’ and consumers.
For those skeptics out there, if it feels like a stretch, that may have been the case 10 years ago but not anymore. Let’s take a small group of 100 followers. If our video game Twitch stream has 100 somewhat-engaged followers, how easy is it for them to be influenced by the next game we play? What about the gear we decide to purchase and use? What about the related topics we consistently discuss? Over a year of following, does that sound like it could result in $50-100 of purchases per follower? That means we could influence up to 100 people to make up to $10,000 in purchases in a year. Whether we decide to take a percentage of that or not (profit versus non-profit), we are still ‘doing business’ just not as explicitly as we are used to.
The big companies know this. That’s why they sell to the influencers who then ‘speak to’ the followers more directly. To reach a million people, these big companies now only have to reach 10,000 influencers with 100 people. That’s usually waaaay cheaper than trying to do that in their own direct campaign and can reduce costs by over a factor of 10 times; all from a bunch of random gamers with 100 people following them.
Ok, we have to admit, in some ways, it seems kind of messed up. Our friends and followers are constantly being influenced and sold things. In sales, they always teach to sell to our friends and families first, and that if we believe in the product, then we’re doing them a favor. But no matter how much we may believe that, putting business pressure on friends and families feels wrong if it’s not done just right. If we blatantly ask everyone to purchase cell phones through our company, unless we can give them a verifiable deal over any other company, it wouldn’t seem genuine. Also, if we ask them to purchase when they don’t need a new cell phone, it also can feel disingenuous or like undue pressure.
How many of us have bought something from a friend or family member, not because we needed or wanted it but because they were our friend?
Enter ‘personal brand.’ The thing about a personal brand is it’s always on, meaning if we ‘sell’ things via our personal brand, we are selling to those who are our friends and family, giving it the same feel as those typical sales courses. Who wants to see constant sales on our Instagram feed every day? “There goes Joe again trying to sell his workout supplements…”
Content Over Sales
Ideally, things should be so well integrated that it is all about the content and interacting with our followers. We should make content for ourselves and for our followers, not for the purpose of selling. Content should be for the purpose of adding value. Then, if by nature of enjoying the content, our followers want to purchase whatever we have available, then so be it.
That’s a fine line that often doesn’t feel like it yields business success. On Instagram, Joe can currently sell more supplements if it’s an obvious, straightforward sell than if he only talked about his workout regime and its benefits with links in his description.
Yet, are Joe’s followers more or less engaged than someone who focuses on content first? GaryVee is one of those who push content over sales and to provide as much value as possible, garnering as much attention as possible before even thinking about sales, playing a patience game.
Is that the right answer for small businesses? Is there still a problem with everything still ultimately leading to sales? Maybe, maybe not, but one thing is for sure: it definitely feels better to focus on passion and content than it does to focus on sales.
Back to Business
We all need to have a business for two main reasons: 1. to save at least 10% on our taxes and 2. to be prepared for the possibility that our personal brand and our existing passions have the potential to give something of value to others.
If we feel bad and don’t like making money off of our friends and family, why do we purchase anything at all? Would we truly rather purchase from strangers than people we know?
The tribal internet landscape is coming; our local market is going to be the realm of our social media ‘tribes.’ There may be a point where we can easily purchase our supplements from Joe, our skincare products from Mary, and our clothes from Susan. Amazon may still exist as a major ‘broker’ just as Facebook, but the exchange of goods and services could be the brands we follow and participate with regularly, not the typical large conglomerates that we have no real ties to.
For those who aren’t into ‘business,’ focus on just creating something of value for others by doing what we love. The interesting thing is that for anyone looking for ‘purpose’ or ‘meaning’ in life, that’s one very easy and real way to do it. If we provide some small bit of value to others, it makes us a part of something larger than ourselves.
We all have our own ‘business;’ we just don’t always make it official. Let’s make it official and register our businesses. The business will be a reminder to live life by always trying to give value to others, even if we just play video games to do it.