How Millionaires Start Businesses

?Value isn?t objective. It is subjective

on the opinions of others, not you.?

??????????????????????? – Derek Sivers CD Baby

Get the Idea

1. Skills they Already Had (or Knew)
2. Found a Need or Problem
3. Asked the Market what they needed
4. (Not Passion!)

Action Item:

Create an Idea Book. Buy a journal and keep it with you to start recording your ideas.

Go through these three aspects and write at least 20 potential business ideas.

Evaluate it

• Lifestyle Test

• Questions

• What will my life look like with this idea, 1 year or 5 years out?
• Is this the lifestyle I want? (dealing with this type of customer etc?)
• What are my start up costs?

• Action Item:

Ask these questions for each of the business ideas.

Remove the ideas that do not fit.

• SWOT analysis

• Strengths: characteristics of the business, or project team that give it an advantage over others
• Weaknesses (or Limitations): are characteristics that place the team at a disadvantage relative to others
• Opportunities: external chances to improve performance (e.g. make greater profits) in the environment
• Threats: external elements in the environment that could cause trouble for the business or project

• Resources:
  • New Product development – Explaining SWOT and customer target (Inc.com)
  • How to Create a SWOT Analysis (EHow.com)
  • Example SWOT Analysis (Used Car Dealer, SBA)
  • Book: Blue Ocean Strategy – How to Create Uncontested Market Space and Make Competition Irrelevant (Millionaire recommended)

• Action Item:

Create a SWOT Analysis on just a few of the best business ideas you have to decide on.

Choose the best one that you want to TRY and move forward with.

• Feedback

• Identify your Potential Customer
  • What is their pain?
  • How old are they?
  • What type of person are they?

• Find 5-10 of Your Potential Customer (in your network or online)
  • Set up a meeting with them and Show them what you have
    • If it’s just an idea ? very clearly explain with diagrams etc

(This is also an important part because you need to make sure you are explaining it correctly, you will get feedback on whether or not you are!)

• Get Their Feedback
  • Create a document/survey for you or them to fill out containing:
    • Under what conditions would you buy it?
    • Second is what price would you pay?
    • *MAKE OR BREAK IT QUESTION* – When can I expect that you and I would sign a letter of intent for that purchase?
  • Resources:
    • How to Make the Most of Customer Feedback (Inc.com)
    • Book: Lean Startup – How Today’s Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses (Millionaire recommended)
    • Book: Rework by David Heinemeier Hansson (Millionaire interviewed and recommended!)

   

• Action Item:

• Identify your customer
• Find 5-10 of them
• Set up meetings with them
• Get their honest feedback (and see if they can become customers now!)

Note: Feedback is a constant process for an entrepreneur.

It Might Make money! Now what?

Business Essentials

????? Logistics

• Figure out a Business Name and Buy the Website Name
  • Resources:
    • Choosing a Business Name (Inc.com)

• Get an LLC and register/get license for your state
  • Resources:
    • LLC Vs Corp (Inc.com)
    • How to Create an LLC (Inc.com)

• Get a good lawyer (In reserve)

• IRS in order (EIN number)
  • Resources:
    • Do I need an EIN? (IRS.gov)
    • Does a Sole Proprietor need an EIN? (Inc.com)

Action Item:

If you are in business- have you done all of these?

Business Plan in a Nutshell

• Quick mission statement
  • Resources:
    • Creating a Mission Statement (Inc.com)
    • Creating your USP -Incorporate this into your Mission Statement! (Inc.com)

• Financial metrics (what are you going to measure?)
  • Resources:
    • Your Critical Numbers in Business (Inc.com)
    • Five Financial Metrics Every Business Owner Should Know (Huffington Post)
• Launch/Entrance strategy
  • Resources:
    • Launch Without a Lot of Money $100 Startup by Chris
    • I Don’t Have Enough Money! (Mp3 by Eventual Millionaire)
• Exit strategy

Future Goals