In this week’s installment of the Better Know a Young Millionaire series, I have the pleasure of chatting with Neil Patel from Quick Sprout. If you’ve been in the online marketing space over the last few years, you’ve no doubt heard about Neil. He started a web company called Crazy Egg, where you can see heat maps of where people click on your website. Not satisfied, he went on to start Kissmetrics, which has become one of the leading online analytics platforms on the internet.
I’d known about Neil for a long time, and read his blog over at Quick Sprout on occasion, but it wasn’t until I was listening to the Smart Passive Income Podcast that I learned something amazing about Neil: he’s only 28 years old. That knocked my socks off, and I quickly reached out to Neil to see if he’d be willing to sit down and answer some questions for my series. Being the awesome guy he is, he quickly agreed!
So, without further ado, let’s learn more about Neil’s story and success:
A lot of people think of you as an SEO guy, but you didn’t really start there . . . you were more like the high school hustler. Can you tell us about your path to where you are now?
Neil: I always knew that I wanted to be an entrepreneur. However, it was probably for the wrong reasons when I got started. You see, I was just looking to make money when I started, instead of helping people solve their problems or create something that I love. I just started looking for ways to make money, but I didn’t really know how to do it because I was so young when I started.
The first things that I really did as an “entrepreneur” were selling car parts and DVDs to other kids at my high school. Eventually, I realized that this was pretty small potatoes, and I needed to create a real business that provided real value if I wanted to create something big. This is what led me to the internet space, where I created a few websites.
Most of these websites failed, but one of them started getting really popular from a rankings perspective (but pretty terrible from a revenue perspective). This website was essentially a copy of Monster.com.
Even though it didn’t make any money, I did learn that I was really good at driving traffic, which led me to consulting and helping others learn how to drive traffic. The trouble with this business was that it wasn’t scalable.
With all these lessons learned, I started getting into the software world, which is what I’m basically doing today.
So, even though you had this entrepreneurial spirit in you, you still went out and got a job while trying to hustle. Can you tell us about your first job?
Neil: So, when I was in high school, I did work while selling car parts and doing my side hustles. My first job was actually at Knott’s Berry Farm as a janitor — picking up trash and cleaning the restrooms. I did this when I was 15 for like six months, and as soon as I hit 16, I went out looking for a “real job.”
That’s when I stumbled into becoming a vacuum salesman door-to-door. However, I did terrible at it. I didn’t really realize until later, but selling $1,600 vacuums to middle- and lower-class families wasn’t the smartest thing.
What lessons did you learn from these jobs?
Neil: The first lesson I learned was hard work and manual labor. It’s not hard from a mental perspective, but it was tough from a physical perspective. It was really exhausting being in the sun eight hours per day cleaning restrooms, picking up trash, and sweeping up vomit.
Second, with my job selling vacuum cleaners, I learned how to sell. I would go knock on doors and not take “no” for an answer. (<- Click to Tweet This) I only sold one vacuum and the couple ended up returning it, but nonetheless, it taught me about sales and being aggressive.
Those strategies paid off because, at my next job at Hollywood Video, I would upsell the customers to buy popcorn and soda. I ended up becoming the #1 sales person in the whole company. Learning how to sell from that vacuum job was well worth it.
Your goals and aspirations were much higher than a “normal” high school student. How did you end up setting such high goals for yourself?
Neil: For me, it wasn’t really about goals. I just wanted to create something and live a better lifestyle. When you don’t have a lot of things when you’re a kid, and you see other people with more stuff, you want that life. My goals and ambitions weren’t big — I never imagined I’d be where I am today. I would just go out there and do whatever it took to make money, because at the end of the day, I just wanted a better lifestyle for myself.
As a kid, I would dream that maybe I would make $100,000 per year. That was my goal, and I didn’t need anything larger than that.
So, even while working and hustling, you decided to go to college. Was that a tough choice — college or entrepreneurship?
Neil: No, that wasn’t a tough choice because my parents forced me to go. They were nagging me about it, and they paid for it. Plus, they paid for gas and food, and let me use their car — so I just wanted to make them happy.
You’ve made a nice sum of money, do you mind sharing what you’re doing with it?
Neil: While I haven’t made that much money, the way I see it is that I go out there and I do what makes me happy. I used to go out there and buy “stuff.” However, I learned that buying stuff didn’t really make me happy. But what did make me happy was helping other people out. So, I’m using some of my money to support non-profits, or even supporting individuals directly.
For example, I met a young kid who didn’t have a lot of money but got into a great school. He didn’t have a good computer, so I bought him a new computer. I like the simple things like this that can make a difference and make people happy. Making others happy makes me happy.
Do you manage your own money or pay advisors to help you?
Neil: Nah, I just manage my own money.
I read that you are big on helping your parents, which is a very different mindset than many people have. Can you elaborate on this?
Neil: It’s a culture thing. In Indian culture, you just take care of your parents. Plus, my parents have always taken care of me. When I was starting out, they lent me $200,000 to start my business. I feel like I might as well take care of the people that helped me get to where I am today.
You’ve also been open about losing money at various times, including one deal where you lost over $1,000,000. What lessons did you learn from losing money?
Neil: I learned a lot of lessons . . . .
First, money sucks when it’s borrowed. It’s not like an investor’s money who takes a leap of faith. When you borrow money, you have to pay it back.
Second, you need to focus. You need to make sure that you’re not going after too many things. This can lead to distractions or just not making the right decisions.
Third, it’s not the ideas, it’s the people. So, in the case of losing over a million dollars, I picked a great idea but bad people. Ideas are a dime a dozen, but if you don’t have a good team, the idea is useless. (<- Click to Tweet) Really bet on the people and team, not the idea. Remember, the idea can change drastically as well. Think of any start-up. Most of the time, the idea that they start with isn’t what they end up launching.
Finally, try to keep your investments to your backyard. I was doing investments in Texas, but I was spending most of my time in Seattle and southern California. That just made it hard to manage.
You’re very open and honest about your mistakes. How do you handle them?
Neil: The goal with mistakes should always be to learn from them and never repeat them. Never repeating them is really the key. Everyone says they learn from their mistakes, but then too many people go off and make the same mistake again. I’ll be honest: I’ve made mistakes and repeated mistakes, but I try to avoid repeating the big mistakes.
You’re big on making sure that you love what you’re doing. How do you make sure that following your passion aligns with making a profit?
Neil: I’m definitely in the “follow your passion” camp because, to be blunt, I don’t have to worry about profit or money any more. I don’t have to make payments on anything anymore, and I live a real humble lifestyle. My expenses are only about $5,000 per month, and worst-case scenario I can live on $3,500 per month. Regardless of my individual situation, I think that is a way to do both.
The way to do both (have a passion and make a profit) is to be passionate about something that is a big problem. If it is a big enough problem that enough people are experiencing, you can make money from it. If you look at the people that have made a lot of money, like Larry Page and Elon Musk, they never originally cared to make a lot of money. Rather, they just wanted to solve a problem — and the problem was big enough and they loved working to solve it.
It’s hard to go out there and say, “I want to make a million dollars” or “I want to make ten million dollars.” It doesn’t really happen that way. You have to solve a problem that people are experiencing, and if it’s a big enough problem, you’ll get tons of profit and it will be doing something you love.
Does this still apply to social issues, like clean water or children’s health?
Neil: Yes! If you love it, there’s still money in it. If you work for a non-profit, you can get paid a market-rate salary to solve these problems, and it’s even better that you’re passionate about them. If you really love it, it will be fun. Remember, it’s not like people are just working for free in the non-profit world.
You’ve done so much in a short period of time. Do you ever suffer from entrepreneurial burnout?
Neil: Not really, because I love what I do. If you love it, you tend to not get as burned out.
If you love it, do you plan on doing it forever; or even say, 10 years?
Neil: I personally don’t even think that far ahead. However, I am slowly setting myself up for the future. That means ensuring that I have a steady stream of money coming in no matter what I do. Right now, I’m investing in rentals and apartment complexes so that I can have multiple income streams.
I’m not thinking about what I’m going to be doing 10 years from now. All I think about is, “Am I having fun?” and “Am I helping other people?” If I’m having fun, helping other people, and making the world a better place, then cool — I’ll keep doing it. If I’m not, then I’ll stop and figure out something else I’m happy with.
Risk and Reward
Now that you’re on the other side, and looking to hire young people for your business, do you think a college education is necessary for people who want to be entrepreneurs or even get into the tech space?
Neil: No, I don’t think college is necessary, and I don’t think I even needed it. However, it is good backup to have. I would recommend that you just follow your heart — if you want to go to college and you think you’ll love it, just do it. I only went to college because my parents forced me to. (<- Click to Tweet This)
Advice for Others
What advice do you have for other young, aspiring entrepreneurs?
Neil: Go out there and have fun. Really try to do something that you love, don’t just do something to make money.
Second, start out as early as possible. No matter what, you’re going to make a lot of mistakes. Odds are your first company is going to fail and you won’t make money from it. But that’s okay! When you’re young, you don’t have too many responsibilities, you don’t have bills, and you can keep living with your mom and dad.
The bottom line is to keep at it. If you learn from your mistakes, you can ensure that your second and third attempts are successful. Plus, make sure you’re having fun while you’re doing it.
What about advice for the entrepreneur in the trenches, that doesn’t know if they are going to make it or fail?
Neil: Go get advice from mentors. Go find people out there that you can bounce ideas off of — this can be personal, business, whatever. The important thing is to get some people to help guide you.
What I Learned from Neil Patel
Neil has an amazing story that resonates completely with mine. I was a high school side-hustler and so was Neil. I worked in retail and so did Neil. I think his story highlights what success looks like in the 21st century. You really have to get out there and do it, and it’s not acceptable to simply be a delusional college student trying to get by.
I also really like Neil’s thorough process on how to make profits and passions align. You have to be passionate about something that solves someone else’s problem. And, based on the size of the problem, you’ll receive profits. I think that goes counter to what a lot of entrepreneurs do — which typically involves selling someone on how important their problem really is. I think his passive approach to identifying the problem and solving it with a great solution is a much more solid way to go about it.
What did you learn from Neil Patel? Do you agree on his thoughts on passion vs. profits?
Robert Farrington is America’s Millennial Money Expert® and America’s Student Loan Debt Expert™, and the founder of The College Investor, a personal finance site dedicated to helping millennials escape student loan debt to start investing and building wealth for the future. You can learn more about him here and here.
He regularly writes about investing, student loan debt, and general personal finance topics geared towards anyone wanting to earn more, get out of debt, and start building wealth for the future.
He has been quoted in major publications including the New York Times, Washington Post, Fox, ABC, NBC, and more. He is also a regular contributor to Forbes.