Courtesy of Michael Coghlan
Michael Coghlan (left), owner and CEO of SimpleTerra.
- Michael Coghlan is the owner and CEO of SimpleTerra, an ecommerce site that sells alternative living solutions such as container homes and yurts, as well as the owner of other smaller ecommerce stores.
- This year, he'll bring in over $1 million in revenue, $400,000 to $550,000 of which he'll keep as salary and the rest he'll funnel back into his successful enterprises.
- Coghlan told Business Insider that the key to his success was a lot of hard work - and a few online classes that taught him about the ecommerce industry and analytics.
- He suggested that young entrepreneurs find valuable mentors and continue to improve their skills every day to reach the $1 million mark in their early 30s.
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The top 1% of American income earners make around $400,000 a year, so those who rake in salaries of $1 million or more are quite rare - particularly those as young as early 30s.
Business Insider tracked down one of these super-high-earning individuals - Michael Coghlan, owner and CEO of SimpleTerra - to learn how exactly he got there, and how others can follow in his footsteps.
Coghlan, who is 31 and married with four kids, explained that this will be his first year clearing the $1,000,000 mark. The majority of his income is generated from the ecommerce store SimpleTerra, which sells alternative living solutions such as container homes and yurts and launched earlier this year. He additionally runs a few other smaller ecommerce stores that are growing in sales each month, including Rec Room Hideout, which offers gameroom tables, boards, and accessories.
When it comes to finances, Coghlan currently takes 30% of the profits of SimpleTerra as owner compensation and funnels 70% of it back into the business. He expects to bank $400,000 to $550,000 as his salary in 2019, leaving around $700,000 to $850,000 to continue expanding SimpleTerra.
Coghlan explained that a "decent chunk" of his profits goes into what he called his "project" account. "I make savings accounts within my business whenever I have a new idea I want to try, and I have got this pretty big idea or project that I want to tackle in the next 12 months," he said. "I could reach out for funding or investors, but I am trying to build up that 'project' account to over $1,000,000 on its own so I won't need any outside investment."
Whenever Coghlan doesn't have a big project that he's saving for, he aims to take 50% for owners compensation and put 50% back in for growth of the business, rather than the 30/70 split.
"While I know many companies believe growth is everything and they pour every penny they have into growth, I think pretty darn highly of cold, hard cash in your personal bank account," he said. "So I try to keep a solid balance of growth and payments/bonuses to myself and [my] employees to keep everyone pushing for more!"
The path from volleyball coach to ecommerce CEO (with a few hiccups)
In his twenties, Coghlan had been happily coaching collegiate volleyball, but a change in his life situation made him rethink his career path.
"When I was 25, I ended up having my first child unexpectedly," he explained. "It wasn't until I had my daughter that I realized the job I loved was having me leave at 6 a.m. (before she woke up) and come home around 9 p.m. (after she went to bed). It was at that moment I began to look for alternatives to coaching."
Coghlan said this career search resulted in his "stumbling" into ecommerce, which he became interested in specifically for its flexibility. "This is going to sound cliché, but I actually chose it so I could 'work from home' and 'be my own boss,'" said Coghlan. "I thought that making some money from home, so I could be around my family more, was going to be a piece of cake."
Within a month of looking for work to do online, he jumped in with both feet, launching his first dropshipping store selling wine fridges and kegerators - but his haste had consequences.
"It was a complete mess," he said. "I tried to rush things I didn't quite understand and ended up messing up my Google Shopping Feed - the feed that gets your products shown on Google - so bad that I had to actually shut down the site and start from scratch all over again."
According to Coghlan, the problem was that his Google Shopping Feed was "done completely wrong," so he had $300 wine fridges listed for sale at $3,000 and vice versa. This snafu resulted in tons of canceled orders and many vendors calling him upset that he was undercutting the minimum advertised price that was set.
"Honestly, I had no idea what I was doing," admitted Coghlan. "But I could see the potential." He eventually took a course called Dropship Lifestyle that taught him the basics of ecommerce, web design, and paid ads so that he could improve his business savviness.
Courtesy of Michael Coghlan
Michael Coghlan with his family.
Through these early bumps in the road, Coghlan discovered that working from home as his own boss was actually not a piece of cake - in fact, it was quite the opposite.
"What I actually found out was that I was putting in more hours than my coaching job for less pay (when starting out)," he observed. "But I was happy because I was able to take a 30-minute break to have breakfast with my kids. I was able to stop working at 5 p.m. to 10 p.m. so I could see the kids and my wife, then get back to work from 10 p.m. to 1 a.m. and start it all over again at 7 a.m. the next day."
His commitment to his new career paid off. Coghlan said he will never forget the moment he made his first real sale through that store. He woke up to it at 4:37 a.m.
"Making money while I was sleeping was actually possible," he realized. "I just had to figure out how to do it consistently and without breaking my website in the process."
The two phases of growth that led to millionaire status
The newly minted entrepreneur identified two phases of growth on his path to his current revenue level. The first phase he described as "simply trying to outwork everyone."
"I figured that if I put in enough hours every single day, I could work my way past my competitors," Coghlan said.
To some extent this plan worked, as he was able to save and then grow his wine fridge store, getting it first to a $500 a month profit, and then building up to a $1,000 a month, $3,000 a month, and finally almost $5,000 a month profit.
Coghlan recognized, though, that more than hard work was at play in his success, noting an element of luck played into the equation through a chance tip from a vendor that caused his store to really take off. The tip was to sell a portable ice maker.
"Not to sound like I grew up in the middle of nowhere, but I had literally never heard of it before," he said. "But it was $220 a pop and I made $90 every time I sold one, so I said screw it and listed it on my site."
The decision paid off, and Coghlan went from selling one ice maker a week to up to three a day within 90 days. "I thought I had made it," he said.
But it wasn't until his business reached what he described as the "second phase of growth" - incorporating analytics - that he started banking serious coin.
"I can 100% attribute the growth of my sites the past few years to learning more about analytics," Coghlan said. "I took the Google Analytics course from Easy Ecommerce Wins and it literally changed the way I saw ecommerce."
The CEO described being able to track down (to the keyword) what search terms were bringing in the most money, and then doubling down on those keywords to make more money as a "game changer," and advised anyone who wants to succeed in ecommerce to follow in his footsteps.
"If I were to ask [a] majority of ecommerce store owners how much it costs them to get someone to sign up to their email list, or what their top five revenue-producing keywords are, or what ad group is producing the largest ROI, I would bet less than 10% of them could answer that," he said. "Now, with all of my stores having tweaks made by analyzing the data and working hard, I am able to see growth I did not even think was possible five years ago."
While Coghlan started out dropshipping, he has now been in ecommerce for seven years and moved far beyond that format.
"While I had some great success with dropshipping, it was a couple years after I started down that path where I began doing Amazon FBA," he said. "Creating products that I owned, instead of being the middleman like I was in dropshipping, and selling those companies I created really took my earnings to the next level."
With that background, he launched SimpleTerra, and today has 10 employees to help shoulder some of the load. "I took everything I have learned over the past seven years from dropshipping, Amazon FBA, SEO rankings, paid ads, [and] retargeting, and rolled it all into a single site," Coghlan said. "Everything I learned over the last seven years has allowed me to create my most successful ecommerce store to date."
Prepping in your 20s to earn $1 million in your 30s requires finding mentors and continuing to learn and grow
When asked what strategies he recommends to those just starting out, Coghlan offered up two main pieces of advice. The first is to find a group of friends or business colleagues who are "doing better" than you are.
While Coghlan said he'd found a mentor figure in the Division 1 head volleyball coach who he worked with in his earlier profession, once he started working online, finding a mentoring relationship became more difficult.
So within his first year of changing fields, he sought opportunities to present at a few ecommerce-specific events to make connections. This helped him meet people who were already successfully doing what he hoped to do.
"Those events were my first access to other entrepreneurs doing the same type of work I was, but they were making five times what I brought home," Coghlan recalled. "Being able to pick their brains on a regular basis, getting little nuggets of knowledge from them, and taking their advice to help me skip past some of the earlier pitfalls they had (but I could avoid) really made a difference for me."
Courtesy of Michael Coghlan
Michael Coghlan.
Even now that Coghlan has matched the income of these high rollers, he continues to meet monthly with the group of successful entrepreneurs that helped him get started, and recommended that others do the same. "I met these guys at random conferences or forums I had attended over the past two years and am trying to learn more from them now, as they are earning three to five times what I make currently," he said.
Coghlan's second piece of advice is to continue learning and developing your skills.
"I see so many people obtain a certain level of success and knowledge in their industry and just stop trying to learn anything else," he said. "Or worse yet, they drop something that could work for them to chase the next 'shiny object' that is going to solve all their problems."
Coghlan added that he believed the reason SimpleTerra has become what it has today is because he took everything he learned over the past seven years and applied it in some way to keep growing his business.
"It is not just paid traffic or SEO that is growing my businesses now," he said. "It is finding better ways to collect emails, setting up lead magnets, getting mini-commitments from our customers in the form of '$5 Tripwires,' [and] working on our email copywriting skills to get better click through rates on the announcements we make."
Coghlan had a clear recommendation for 20-somethings trying to pick a big money career path.
"Obviously, I am going to sound a bit biased, but I do think if you have the stomach for it, it would 100% be entrepreneurship," said Coghlan. "Specifically, online entrepreneurship."
He also added that he couldn't have achieved this level of business success without a high level of support from his spouse. "To have four kids as young as we do, as I was trying to navigate making money online so I could be at home more with her and the kids, was quite trying at times," said Coghlan. "But her support and belief that it could be done did wonders in helping me pick myself up off the ground every time something I tried failed."
Ecommerce is not a path for everyone, but it certainly worked out for him. "I have gone from barely being able to put food on our table, to living comfortably, to putting everything I had saved up to purchase a home into a new business that was untested, to finally making more than I ever have," he reflected.