This transcript was generated from the episode audio and may contain minor errors.
[Music]
Today's Failure Friday story is one I have heard in different variations several times over the years for actually a couple of decades now. PayPal has been around, I forget exactly what year it came out, but I think PayPal has been around more than 20 years. I used to use PayPal in my very early days of selling stuff on eBay, and then used it in a variety of business. I actually used PayPal to take in ticket revenue for the first world domination summit. And thankfully I did not have a failure or disaster, but I've known several people who have had pretty much the same story that you're gonna hear today.
Like I said, different variations, but sometimes PayPal, and it's not just them, it's other merchant accounts, other financial companies. Sometimes when you take in a lot of money, whether it's for a product launch or a future event, they get worried and they think, "Oh, this is fraudulent, this is some kind of scam." And instead of asking you about it or trying to get some clarity and understand that it's actually a perfectly legitimate use case, sometimes they just freeze the account. And it's very difficult to get information to or from them. It's very difficult to appeal the process, and it's extremely stressful for somebody in that situation. So one thing you can do is not use PayPal because they are somewhat notorious for this.
At least if you're gonna use them, make sure you have some backups, make sure you're not keeping a lot of funds in that account, just transfer anything that comes in right away. But I'm kind of getting ahead of things here because I want you to hear the story. And so this is a story from Patrick. He's from Chicago, had a big event. His first big event, in fact, took in more than $50,000 and then had the problem that I have been describing.
So let's hear the story from him. Welcome to Side Hustle School. This is the weekly installment known as Failure Friday. What goes wrong? Mistakes, disasters, setbacks, and of course, failure.
What do you learn through the process and what can you as a listener, as a side hustler, do to potentially avoid this particular failure or disaster? Over to Patrick from Chicago. I'll have a quick wrap up at the end. [Music]
So for years, I'd been dreaming of hosting EmpowerCon, a live event dedicated to inspiring entrepreneurs. Everything was meticulously planned.
The speakers were lined up. The venue was booked in a prime downtown location and early bird tickets had sold out within hours. In my mind, this was it. My moment to step out from behind my computer screen and connect with my audience in the real world. To streamline the ticketing process, I used PayPal as the primary method of payment.
It was a platform everyone trusted, including myself, or so I thought. Just when I was getting ready to make the final payments to the venue and caterers, PayPal froze my account. Suddenly, I had no access to the $50,000 I had collected in ticket sales. My heart sank as I read the email stating the funds would be held for further review, a process that could take months. Panic set in.
I had speakers flying in from around the country, attendees who'd booked hotels and vendors that needed to be paid. I was staring down the barrel of a logistical and financial nightmare. With no other options, I decided to float the $50,000 myself. I drained my savings account and leaned on a few credit cards. Each transaction felt like a stab as I didn't even know when or if I'd get my own money back from PayPal.
The stress was unbearable. Instead of focusing on delivering an incredible experience for my attendees, I found myself consumed with cashflow spreadsheets and trying to talk to PayPal's support team who seemed to be experts in saying a lot without saying anything at all. Ultimately, the conference was a hit on the surface. The speakers were inspiring, the crowd was engaged, and the social media buzz was everything I'd hoped for. But behind the scenes, the financial uncertainty cast a shadow over the entire event.
It took another month after the event for PayPal to finally release the funds. This was a total of six months of sleepless nights and constant anxiety. When the money finally came through, I felt more relief than joy. What did I learn? First, never put all your financial eggs in one basket, especially when that basket is controlled by a third party platform with its own set of rules.
I now use multiple payment gateways and even accept old school checks for larger amounts. Second, always have a contingency plan for the worst case scenario. I thought I had planned for everything, but this experience taught me that everything can be far broader than you might ever anticipate. Today, my new event series is stronger than ever, but I'll never forget that first event, the one that taught me the tough lessons that helped shape the more stable, savvy entrepreneur I've become. It's a bitter pill I had to swallow, but it's also a lesson I wouldn't trade for anything, because sometimes the lessons you learn from failures are the ones that empower you the most.
[Music]
Never confuse a single defeat with a final defeat. Well done, Patrick, for overcoming this very stressful situation. I was actually talking to a friend of mine who is also named Chris recently, who had, as I mentioned earlier, a different variation on a quite similar experience. I think it was also between 50 and $100,000 that was held in an account for months, and the whole time he had to pay vendors, he had all sorts of bills that were coming due, and it was not in a great situation to be able to float that amount of money. So thankfully, my friend Chris was able to overcome it, Patrick as well, but there are some lessons there.
Be careful where you keep your money and such, and just think through contingencies. Think through what is the worst case scenario here, or what can I do to avoid it, but also know that you're probably going to be okay, as difficult and stressful as it can be. So thanks again, Patrick. Listeners, if you have a question or an update about your hustle, sidehustleschool.com/questions. Thanks for being out there.
We like to highlight all kinds of things, the good, the bad, the challenges, and ultimately, why it's worth it to go through the challenge. So hopefully, your challenges will be worth it as well. There's something better on the other side. And of course, there's a new episode coming out tomorrow. All right, that's all for today.
My name is Chris Guillebeau. You're listening to Side Hustle School. [Music]
From the Onward Project.
