Transcription
So, you want to make a million bucks? I got you. If you just focus for the next 30 minutes, I will give you a simple three-step blueprint to make a million dollars from scratch with no experience or investment. Or you could get distracted, go back to doom scrolling, and wonder why you're not making progress in life. I'm not your babysitter. The choice is yours.
My name's Mica. Micaia. Micaia Rson. I built and sold my last company for $110 million, which means I can freely share the exact systems I used to achieve financial freedom. Now, if you're tired of slaving away in your 9 to 5, feel frustrated by your lack of progress on your business, or have tried a business before only to fail, you might worry deep down that maybe you're just not good enough.
I remember about 7 years into entrepreneurship, I still only had $1,600 to my name and I was $30,000 in debt. But it turns out the reason my businesses kept failing wasn't because I was a bad entrepreneur. It was because I was trying to start businesses in markets where I had to create my own momentum by beating competitors and carving my niche into a market that already exists. It's like pushing a boulder uphill.
But the real way to build life-changing wealth fast is to find a billion-dollar market so desperate for a solution that it's like pushing a boulder downhill. You just have to get the beginning right and then winning is almost automatic. So, how do you find billion-dollar desperate markets? This is the exact method I used to come up with the business idea that I sold for $110 million that I actually learned from Jeff Bezos.
You see, before Jeff Bezos founded Amazon, he was a New York City man in finance working at a hedge fund called De Shaw. And every year, De Shaw would invest millions of dollars trying to figure out what market trends were happening because they knew if they spotted the right trends early could be worth billions. But then one day, Jeff came across a report so crazy he quit his million-dollar job immediately after reading it. So, what do you think was in the report?
The report showed data on the web usage statistics of households. And that number was growing at 2300% year-over-year. And Jeff was a smart man. He knew that this was going to disrupt a massive market, traditional shopping, as more people considered buying things online. So, he quit his job and started an online bookstore called Amazon. And this one little data point and insight turned him into one of the wealthiest men to ever live.
So, let me show you a dead simple way to use this exact technique to come up with your own million-dollar insights. The most important thing you need is data on market trends and the biggest disruptions happening in different markets. But finding that data can be challenging. It's why these firms spend millions of dollars a year every year to find them. Thankfully, there's an easy trick.
See, there are consulting firms that hire hordes of analysts to comb through all the data and try to find the biggest market disruptions happening today. And what's crazy is they give these reports away for free. Why? Because their actual business model is selling consulting to giant companies for millions of dollars. So they release these little reports and white papers as a way to get the attention of these giant companies. But this is where the magic comes in.
Instead of you doing all that research, you can leverage the literally hundreds of thousands of analysts already working on these reports and get them for free from these big firms. The big three are McKenzie, BCG, and Bane, but there are dozens of others. But don't waste your time trying to Google them. I've already made a handy doc that has links to all the best research firms reports for free. So, I'll put a link in the description below. It will save you hundreds of hours of time. Just go there and get it for free.
And then as you're reading reports, I want you to look for three specific things. First is a change that's creating new opportunities. For example, when I was building ideas for my own startup, we saw that the percentage of people wanting to buy cars online was 48% up from 35% the year before. And then the second thing you're going to look for is a gap in existing solutions. So for us, we did some quick Googling and it showed us that car dealerships actually couldn't sell cars online. So then we knew we had a problem and a gap in the solutions available.
But the third thing we needed to check was the size of the market. See, if you choose a small market, you need to dominate the field just to make good money. Instead, you should play in markets so large that you can just take a small slice of the pie and still make more money than you know what to do with. Now, my simple formula for figuring out if a market is worth entering is to take the number of customers that would buy your product times the price that you think you could sell it for. and that has to be greater than a billion dollars.
So, here's how the math worked for my own startup. First, I Googled how many car dealerships are there in the US. Google says there are 48,133 new and used car dealerships. Next, I Googled how much are car dealerships currently paying for software. And I learned that dealerships often buy software for $2,000 to $5,000 per month. I'll just call it 3,000 or $36,000 per year. So, then I just plug in my formula. 48,133 dealerships times $36,000 per year equals $1.7 billion. So, this opportunity passes the check. And that's the exact math I did when I started this business that I sold for $110 million.
So, congrats. We're just a few minutes into this video, and you've already learned my exact formula to find million-dollar business ideas, and you got it for free. Now, if you appreciate the value I'm giving here, I'd love it if you subscribe to the channel so I know that these videos are helpful.
Now, once you've come up with your opportunity, you still need to be very careful because the right business idea with the wrong business model can still easily fail. So, it's critical at this stage that you avoid building what I call a low-lever business. I found out what a low-lever business was the hard way. Right after college, I was running a marketing agency, and on paper, I was doing great. I was just 21 years old, charging clients $300 an hour. But because I was in a lowleveraged business model, I was ultimately still just a slave to my time, trading my time for money. Congrats, you traded your 9 to 5 for 24/7. But even worse, I wasn't building any real wealth.
See, when you run a lowle leverage business, you as the owner increase your net worth by essentially sales minus expenses and then leftover profit to you. So if you make $100,000 in sales, maybe you have $50,000 in costs. So at the end of the day, your personal net worth only increases by 50 grand. A high leverage business, on the other hand, means every hour of work you do is greatly multiplied, allowing you to build wealth significantly faster while working less hard. For example, take the same $100,000 in sales from our last example, but pump it through a highle leveraged business. And your personal net worth can increase by $1 million or more. And maybe that sounds like a pipe dream, but that's what's known as a 10x revenue multiple. And it's not so crazy. In fact, let me give you some comparisons for some businesses that you've probably already heard of. For example, for the last 5 years, Shopify has traded at a 29x revenue multiple, meaning that for every $100,000 of revenue they generate, the business is worth $2.9 million more. And if you think that's crazy, Adobe tried to buy Figma for 50x revenue.
So, let me show you exactly how to build a high leverage business. Any high leverage business needs four things. First is a recurring revenue model. There's a reason every single product under the sun now is becoming a subscription. It's sell once and make money repeatedly. So whatever you sell, whether it's toothbrushes or software, it needs to be something that the customers use every month and buy repeatedly.
Second, you need high profit margins on your core product, usually at least 70%. Which means if you sell your product for $100 a month, it should cost less than $30 per month per customer. And there's two ways to get there. You can either mark your product up to a certain percentage or sell a digital product like a community, a course, or a software product where your costs are naturally very low.
The third thing you need is a business that scales through technology, not people. If every time you add a new customer, you need to add people to the business to manage that customer, your business is a nightmare to run and will always struggle with profitability. That means no agencies, no consulting, and no physical products. While those work, they're just messy businesses to run and you're better off avoiding them.
And then fourth, you need to be selling your own product, not someone else's. If you don't own what you build, the terms of the arrangement can always change or any other slick marketer can come in and sell the same product as you, and then you get into pricing wars. So that means no affiliate marketing and no drop shipping. You can hire someone to build the product, but ultimately what you sell needs to be your product.
Now, if you just combine the concept of a billion-dollar desperate market with a high leveraged business, you will already be ahead of 99% of entrepreneurs. But there are still two critical mistakes that can lead to failure when if you had just acquired the right knowledge, you could have been successful. The first mistake is the what, how, who dilemma. And I learned this one the hard way when I was trying to get our first customers at my startup. I was calling hundreds of potential customers a day. And I kept getting people that really liked my idea and my product, but then they didn't buy.
So, one day I decided I'm going to record all the sales calls I'm doing and see if I could listen back and figure out what was going wrong. And listening back to the recordings one day, it hit me. I was selling the product all wrong. And if you're making the same mistake I was, doesn't matter how good your product or marketing is, no one will buy. So, let me break down the what, how dilemma so you can avoid it.
First is the what. In order to make any sale, you need to figure out what your buyer wants. It's a live conversation. get curious about what they want. What problems are they trying to solve? Or what are their desired outcomes from buying? Or if it's a marketing message, you're going to call out the what in your message. Don't call out the features or the functions of your product. You're calling out what change will happen in their life if they buy your product.
And then once you've nailed the what, you need to nail the how. As in how will you deliver these changes you promised in your what. This is where you walk through your proprietary technology, your benefits, or whatever it is that you do specifically to give them what they want. If your buyer doesn't believe your how will solve their what, there's no sale.
But then once they do believe, the last step is actually the most important because if you've identified what they want and how they will get it, the only reason they might not buy from you is because they don't believe you can actually deliver on the promises you've made. So to close any deal, you need to explain why you or your company are the best option for them. This is where pricing, testimonials, reviews, and commitments to service all come into play. And so in my own startup, as soon as I added some slides to my sales presentation about me, the company, who we were, our credentials, our backgrounds, etc., people started buying. And if you simply followed the what, how, who framework, you can sell anything to anyone.
But of course, sometimes you'll run this process and you won't close the deal. Or even worse, what if you're selling the wrong product entirely and you don't even realize it? You could spend months or even years wasting your life with no chances of success. So to make sure this doesn't happen to you, you need a way to make business progress quickly without wasting time or taking on unnecessary risks. And the way you do that is by using what I call the lean learning loop. This is something we developed at my startup and it's essentially combining the best principles from the lean startup by Eric Reese and first principal thinking made famous by Elon Musk. Here's how you use it.
First, whenever you have a goal, you're going to list out all of your best hypotheses on how to achieve that goal. To make this concrete, I'll use an example. Let's pretend I'm a chef. I run a cooking blog and I want to find a way to make some more money from my website. So, my goal is to make extra money from my blog. So step one, I write my ideas down as hypothesis. And my hypothesis is that if I write a book, people will buy it. But how do I know if they will actually buy it?
So step two, I need to design tests to validate or invalidate this hypothesis in the leanest way possible. Sure, I could write the book and put it for sale, but that's a lot of time and effort to risk. And as a new entrepreneur, you do not want to be taking big risks on your time and effort. So, I'm going to come up with the leanest idea possible, which in this example, I'm going to add a new page to my website that says, "Buy my book." And I'll make a landing page that says, "Hey, thanks so much for stopping by. You know, I'm thinking about writing a book. If you'd be interested, leave your email below and I'll let you know when it comes out." And that might take me an hour. I can launch that page, add a link to it in my navigation, and then start collecting data.
So, step three is I want to collect this data and draw conclusions to loop back to the original idea. So, let's say at the end of 2 weeks, I look at the data and say, hm, my blog has gotten 30,000 visits. And you know what? I got 3,000 clicks to the buy my book page. And with a bit of Googling, I learn that on Amazon, as a comparison, 10% of people that view a book on Amazon buy that book. So, I sit back and say, well, you know, if I have 3,000 people visit and 10% buy, that's 300 books every 2 weeks or 600 books a month. Wow, if I sell the book for 20 bucks, that's an extra $12,000 a month. That's pretty good. And now I can write that book and put in all the time and effort because I've already validated the idea as a valid way to add revenue to the business.
So these two frameworks will save you so much time when you're starting your business. But now it's time to show you how to actually start the business. So step two, launch your business. If you're like most entrepreneurs, you probably think step one is to build the product, right? After all, no product, no sales. But this is actually the worst thing you can do when you build a business and one of the fastest ways to fail in business.
Okay, so we're not going to build the product first. But can you guess what we're going to do instead? We're going to sell the product. Yeah, sell it. I sold more than half a million dollars of my product at my startup before we ever built the product. So that when we did decide to build it, we knew immediately we'd have paying customers before we ever risked a dollar of our own money. And so let me show you how to do that step by step.
You're going to build what's known as a cap, a customer advisory board. This takes the entire sales process and sales resistance that you typically encounter early on and flips it on its head. So, what you're going to do is you're going to build a list of ideal customers and reach out to at least 50 per day. But, you're not going to try to sell them anything. Instead, you're going to ask them for help.
Your framing and basic script for this is, hey, I'm an entrepreneur building solutions for people like you and I would love to have a brief conversation about your job, business, life so that I can make sure I'm building the best product possible. Would you be open to a brief chat sometime? And because you're just genuinely asking for help, a lot of people that would normally say no to a sales conversation will actually get on the phone with you.
Then when you get them on the phone, you do actually ask them for advice. You're not just like a sales hack where you trick them into buying something. You actually want to interview them because it's business gold. So ask them about your product. Ask them about the problems that they're encountering and if they think what you're building would solve those problems. And then after they've given the advice, you're going to say, "Hey, you know what? This was so valuable. I'd love to find a way for us to continue these conversations occasionally where creating a customer advisory board. Would you be interested in joining by chance?" By calling it something and making it sound official, people already have a higher perceived status of it and they'll be interested because it sounds important.
But what you say next is critical. You're going to explain to them how it works. And here's the exact pitch I want you to use. You're going to say, "Listen, we're putting together a small group of innovative industry leaders to help guide our product development and shape the product that we're building. As part of the customer advisory board, you'd get the benefit of having direct access to our team and a voice to shape the road map. So, we make sure we're building the best product for you. And of course, to do that, you need to actually be using the product. But don't worry, if you're interested in joining, we'd give you a lifetime discount of 50 to 70%. I really like 70% here, but you can choose your own number. But then you follow up and say, so you'd actually be getting an insane deal. Now, all we ask in return is that you actually use the product, give us honest feedback, and also let us use your success as a reference as we grow our business. If you're interested, let me know. I can send over the paperwork, which by the way also makes it sound way more official. And then you ease their worries by telling them, "Listen, this isn't a binding agreement to buy our product. It's just an LOI, a letter of interest, which lets us lock in your place on the cab, so we reserve your spot and we know you're serious about this." And that's it. Just repeat this until you get your first 10 customers lined up. Then you start building your product.
But now we need to talk about actually building your product because building the wrong product is the number one startup killer with 42% of startups dying because they built the wrong product even though they had paying customers. And the biggest mistake you can make at this stage is trying to build a really impressive product that just wows your customers at every level. You might think this is best, but this only leads to slower development times, more wasted money, and ultimately kills the business.
So at this stage, you actually need to take the complete opposite approach and build what I call a black car product. It's inspired by one of the greatest entrepreneurs of all time, Henry Ford, and his famous quote, "Any customer can have a car painted any color that he wants so long as it is black." And this is the perfect metaphor for building your first product. Your product should be a black car product, a product so narrowly scoped that it is a singular tool designed to solve one problem and one problem only. And until you've sold that product and solved that problem repeatedly, you do not build additional features to solve additional problems.
Now, of course, you don't want to make every sale and build the product all by yourselves. You probably want to get some leverage and start freeing up your time. So, it's time to hire some people, but hiring people is often one of the worst things you can ever do to your business. See, beginner entrepreneurs think more people equals faster progress. But experienced entrepreneurs know more people also equals more management overhead and more people problems. So if your business isn't actually prepared to handle that, it will grind your business to a halt as you spend all your time putting out fires and fixing mistakes instead of actually moving the business forward.
The solution for this is to build what I call a pizza squad. It's inspired by Jeff Bezos's two pizza rule, which stated that no meetings at Amazon should have more people than two pizzas could adequately feed. In practice, this means roughly five to eight people. And this is the perfect size for an early stage business. As an entrepreneur, you should do everything in your power to keep the team under eight people until you hit $1 million in sales. You will get there so much faster if you can keep it lean and move quickly.
Now, at this point, your business is growing. You've got happy customers, but you still haven't achieved the life of your dreams. So, step three is all about how to grow the business while freeing yourself from the business dayto-day. And at this point, the number one choke down your business is actually you. Or more specifically, it's your mindset.
To help you understand, I need to reveal a bit of a dirty secret about Silicon Valley that no one wants to admit. See, when I first arrived in Silicon Valley, I had this dream of founders growing these companies from the ground up from their garage to their penthouse offices overlooking the world. But after a few months there, I started noticing a disturbing trend. founders were getting fired from their own companies left and right. I mean, just look at Sequoia Capital, arguably the best tech investor on the planet. They get to look at thousands of companies every year, and they only invest in a small handful, the true.1% of the best companies on the planet. And yet, even amongst these best of the best companies, Sequoia Capital fires 45% of the founding CEOs that they invest in within 18 months of their initial investment.
So, what the heck is going on here? Sequoia Capital knows something you don't. Early stage companies grow at an extremely rapid rate, often doubling or tripling revenue every year, the first few years. And while this sounds great, it represents a huge problem for the CEOs of those companies. Because the CEOs of those companies also have to grow their skills and capabilities 200 to 300% year-over-year or they will end up being the chokeold on the entire business. But leveling up your skills two to 3x every year is nearly a full-time job. Which is why so many CEOs fail to pass the test.
When I was building my startup, I was absolutely determined to not be one of those CEOs that got fired. So, I built what I called my triad of influence, which allowed me to make leveling up automatic. Here's how you can build one, too. Now, the triad of influence consists of three categories of people that are going to grow you.
First are your peers. They're going to inspire you, encourage you, and you can learn alongside them. To find them, you can join meetup groups, join peer groups, go to conferences, you know, set up co-work sessions. But you want to have at least five people in your life in this category that are your peers.
Second are your mentors. These are people a few years ahead of you on the journey. They're going to help you avoid the potholes along the road, sharing their wisdom and potentially saving you years of time. You can also use these people when you are panicking and need answers quick. Now, a warning. It's important that these people are not your investors because you want pure unbiased advice, not someone who's just trying to save their own investment. So, one way to find these people is cold outreach via email or Instagram DMs. But actually referrals from your peers are by far the best method and the one that I use. And what you want to do is you want to grab coffee with these people roughly every month or so and give them progress updates. For this category, I recommend you get three mentors that have agreed to grab coffee with you regularly.
And then the last category you want in your tri of influence are heroes. Now these are people who have achieved the dream life you want. And early on I actually don't recommend cold outreach to these people. the gap between where you are and them is simply too large and it's going to be hard to get in the room with them and actually be able to have a real conversation. So, the best way to get these heroes into your life and to get their knowledge into your head is to consume content from them. So, to do that, here are three books from billionaires that really inspired me and will teach you everything you need to know. First is The Hard Thing About Hard Things by Ben Horowitz. Second is Shoe Dog by Phil Knight, the founder of Nike. And third is total recall by Arnold Schwarzenegger who is now also a billionaire.
Now with your triad of influence in place, let's talk about how you can tactically actually free yourself from day-to-day operations and grow the business faster than ever. See, in the early days of your business, you'll be throwing lots of stuff at the wall to see what sticks and what doesn't. And the biggest trap you can run into at this stage is trying to look at what doesn't stick and say, "Hey, what can we do to fix this?" This common mindset is rational, but it's actually the fastest way to fail as a business.
Instead, you should focus on what's sticking. Take a look at everything you've tried in the last year and say, "Are there patterns to what we're doing where it's working? Are there certain company sizes that tend to buy from us more? Is there a certain email sequence that converts more customers?" Find the patterns in what's working in your business already and double down on them. These will become your superpowers for growing your business. And then what you're going to do is take these superpowers and scale them so that they can run on autopilot without your involvement.
To do this, you're going to follow the document and delegate method. So first is the documentation. You're going to take the highest performing parts of the business and turn them into playbooks that anyone can follow. The best way to do this is to actually record yourself doing the activity and then write a document to go along with it explaining every single step so carefully that anyone regardless of skill level or training could read through the playbook and execute the steps. And to get even more leverage, you don't have to be the one writing this playbook. In fact, you probably shouldn't be at this stage. You really want the best person in your company at that specific task recording themselves and writing the playbook. So, your best closer writes a playbook for closing deals. so on and so forth.
Second, you're going to delegate. You're going to either hire or promote your best people to be department leads and have them hire, train, and manage other people to execute on the playbooks. Now, as you're doing this, don't forget the lean learning loop. You can't just run the playbooks as written forever. You need to be constantly testing new ideas, seeing what works, and building a process of continuous improvement for each playbook of your department. and before you know it, you'll have a multi-million dollar business cranking away that requires little involvement or time from you, leaving you time to live your life of freedom and happiness.
Now, there's one thing I left on this video, but it's critical to your success, and that's a millionaire's mindset. Because if you're trying to become the first millionaire in your family, chances are there are lessons about money and wealth you simply haven't learned yet, and the lack of knowledge there will hold you back. So, I made a video about how to become the first millionaire in your family. I'll put a link to it over here. I hope it helps and I'll see you in that.