Transcription
If I had to start from scratch tomorrow and I worked a 9-to-five job that I hated, this is the exact blueprint that I would use to escape it for good without a fancy degree, without raising investment money, and without having to do something I'd have to hide from my family.
Step number one is I need to know how much money I need to make so I can quit my job. So, if I'm working a job right now and it's paying me, let's call it $80,000 a year, that means I need to be making roughly $6,700 a month to be able to quit my job and not change my lifestyle.
Step number two, I got to set my business parameters. I've been a business owner for more than a decade now, and what I look for in a good business are five things.
Number one is scalable revenue potential. So, hypothetically, if I could sell my labor for $100 an hour, well, that means now my revenue potential is linear because if I wanted to make $1,000, I have to work for 10 hours. If I wanted to make $10,000, I have to work for 100 hours. I have to keep working more to earning more. I want to own something that can 10x the revenue potential for every piece of incremental effort that I put in. So, if I put in 10 hours of my time, I get out $100. But if I put in $100 of my time, now I can make $10,000. uh put in a little bit more work to make a lot more dollars out.
To give you a practical example of what I mean by the scalable revenue is in my company briefs media, we have a product called market briefs. This is a free financial newsletter for investors. We have hundreds of thousands of investors that read market briefs every morning. And the way that we make money on this newsletter is we have advertisers that buy advertisements in our newsletter. Well, the cost to us to produce this newsletter doesn't really change whether we have five people reading the newsletter or 500,000 people reading the newsletter. It's the same newsletter. Now, as we've grown, we've added more staff to make it a better product, to add more creativity, to keep it funny, to keep it interesting and within our brand, but the real cost of producing that newsletter doesn't really go up. And the cost to send the newsletter doesn't really change. I mean, yeah, we have some slightly additional operational costs with their software and other things like that, but the real cost of running the business doesn't scale the way that the revenue can scale because when we grow from 50,000 subscribers to 500,000 subscribers, our revenue can 10x, but our operational costs grow marginally. That's what scalable revenue potential means.
Number two is I want to see reoccurring revenue. I like to think of it like toothpaste. Most people use toothpaste. If you don't use toothpaste, keep your distance. But toothpaste is a great business because you got to use your toothpaste in the morning. You got to use your toothpaste in the evening and some of you are also probably using your toothpaste in the middle of the day and so you keep needing that toothpaste which means you got to keep buying more toothpaste. That's the type of business model I want to see instead of something like ACs or furnaces. When you buy an AC unit for your house, you hopefully will never need a new AC for 10, 20, or 30 years. I don't like that. I want to own something where people have to keep buying it again and again and again.
Number three is high profit margin. This speaks for itself. I want to own something that has big profit potential. So, if I pay an attorney $1,000 to review a contract, pretty much all of that is profit because there's very little cost. It's just your labor compared to something like selling t-shirts. If I sold a t-shirt for $25, well, I have to pay the cost of designing for the t-shirt. I have to pay the cost for the actual shirt. I have to pay the cost for printing on the shirt and then I have to pay to actually ship that shirt out. And so, I'm going to be left with very little money after paying for that whole process. So, I want the higher profit potential.
Number four is I want this business to solve a highpaying problem. So, for example, I can go out and create an app that shows you your checking account balance, your savings account balance, and your stock brokerage balance all in one app. It's cool and convenient, but it doesn't solve a very heavy pain point, which is just I have to go to another app to see the balance of money that I have. Compare that to this, an app that now tells you when you have a bill coming due. It tells you when you're being overcharged by a company. It tells you when you have a subscription that you're not using. So, it tells you when you're wasting money on things that you shouldn't be. and then it will go and negotiate those bills down for you. So the pain here is you're paying too much money and it's going to save you money. That's a much higher pain threshold. I'd be more willing to pay for something that can save me money as opposed to something that just is going to show me my account balances right there when I could just go to the other app and see how much money I have in the other account. I'm much more willing to pay money and pay more money to something that's going to give me more pain reduction.
And then number five, it's got to be something that's actually sellable. I'm not a coffee drinker, but I like tea. And I can go out and create the world's best tea mug. It's beautiful. It sits perfectly in your hand, and it's going to keep your tea at the perfect temperature. Now, I could go out and build this. Maybe I got to sell it for a lot of money. I got to sell it for $2,000 to actually make any money on it because of how intricate this thing is, but not many people are going to want to pay $2,000 for a T- mug. So, it's got to be something that people would actually be willing to pay for, which then aligns with all of the others.
So, we started by talking about how much money you would need to be able to quit your job. Then, we set your business parameters. Now, we're on to step number three, which is find the pain and mix in your secret sauce.
In business, there are five pain areas that people are willing to spend the most money on. And they are number one, the pain of time, wasting time, not having time. The pain of two, finances. If you can help somebody save money or earn more money, they'll be willing to spend money on that. The pain of three, health. People will spend money on their health. whether they already have a problem or want to prevent a problem, people will spend money on their health for that. Number four, the pain of happiness. People want to feel happy and if you can help somebody be happier or stay happy, they will spend money on that. And number five, the pain of peace of mind. People will pay for security. People will pay for insurance. People will pay for the peace of mind. That way they can rest comfortably knowing that their loved ones are safe and sound.
This is where you have to find your moat. Now, I talk a lot about investing on this channel, and Warren Buffett has coined the term moat with his investments, which means he looks for investments. He looks for companies that have a big barrier to entry. That's what the moat is. That no other company can compete with this company because of how good their moat is. For example, Coca-Cola has a big moat. Why? Because you could put a Coca-Cola and a RC cola right next to each other, charge four times more for the Coca-Cola, and people will still pay for the Coca-Cola because they love the Coca-Cola. That's what your moat is.
Now, for you, what is your moat? If you're just starting off, my moat is me. It's my interest. It's what I know better than anybody else around me. And for me, my moat is finance and marketing. These are two things that I like. So, I want to be able to mix my interest, finance and marketing, things that I'm interested in, things I will spend a lot of time learning and being the best at. And now, I want to blend that right here with the pain points because that's what's going to help me build a product that I can actually sell.
Now, I already own a business on the finance side. I own Briefs Media, one of the fastest growing financial media companies in the United States. So, for the purposes of this video, I'm not going to talk about the finance side. I'm going to talk about the marketing side because that's something that I'm not doing, but it's something that I'm interested in. And I also want to utilize artificial intelligence because technology is all moving towards AI. So, I want to make sure that I'm on top of the AI. So, my secret sauce is going to be marketing because I'm already doing the finance side. I'm going to focus on marketing. I'm going to utilize AI. And then I want to solve a painoint. I'm going to utilize this business parameters. That way I can get to this number.
Step number four, find the product using this formula. Parameters plus pain plus secret sauce equals the product. Remember, my secret sauce here is going to be marketing. We're going to look at these pain points right here that fit within these parameters. I know that small business owners like dentists hurt and lose money when patients do not show up to their appointments because there's a limited number of dentists. There's a limited number of chairs and if a patient's not showing up, that is a vacancy. and they're not getting paid. So, I could create a business where I'm following up with the patients every time there's an appointment to make sure they show up. And if I can get a couple more patients to show up every single month, well, that would be a business that's going to help that dentist make more money. So, this is something that's sellable because dentists would pay money if I can make them more money. Number two, it's high pain because dentists and all business owners don't like losing money. Number three, it's high profit margin because it's just me and my labor. So, yes, that profit margin is there. It is like toothpaste for the dentist because if I can keep bringing them more patients every single month, well, they're going to want to keep paying me every single month because I'm bringing them more money than they're paying me every single month. But it's not scalable. There's only so many phone calls that I make. Maybe I can handle five dentist offices total, maybe 10. So, there's a limit to how much I can earn. It doesn't have the scalable revenue potential. So, while it has the pain, it meets my secret sauce of marketing, the parameters are not there. So, that is not a good product.
So now let me refine this product a little bit. Let's assume now that instead of me manually calling the patients, I can build a tool that is going to automatically send out a phone call reminder and a text reminder to patients when they have an appointment. And if they can't make their appointment, they can cancel right off of that text and I can work with AI to automatically try to fill that appointment with people that are on the waiting list. That way if somebody does cancel, they let us know and then tries to fill that slot. That way we can minimize the vacancies. That way, number one, the dentist can make more money, but also number two, it keeps the business running more efficiently. And then I can make it even a little bit better because after the appointment is over, I can send a link saying, "How was your experience? Give us a rating on Google. Give us a rating on whatever Yelp." And leave us a fivestar review. This way, now the dentist can also get better reviews on their profiles on Google and everywhere else. Because dentists are not marketers, right? They're good with teeth. They're good with medicine. They're not good with marketing. But if I can get them more reviews, that can help them be better on Google, get more patients, make more money, because every patient for a dentist office is worth at least $1,000 on the low end. And if I can automate this process, well, now I have the ability to make this scalable. Is it sellable? Yes, because of the same reason as before. Is it high pain? Yes, because I can help the dentist make more money, save on cost. I can have a high profit margin because now, yes, it is a lower cost. is a tool and a technology that can scale and it doesn't even need my labor anymore. It has the reoccurring potential because once I set it up, the dentist is not going to want to let go of this tool because it's going to keep bringing them more business. It's going to make them more money because we're going to have less vacancies and it's going to make it a more efficient practice. So, they're going to want to keep paying me month after month after month and now it is finally scalable because I can keep adding on more businesses into my tool that are paying me full price at marginal additional costs.
I'm not a coder, but I know that if I use AI and I put in 30 to 90 days, I could figure out a way to build a very rough version of this product that I could launch. It's not going to be perfect. It's not going to be beautiful. It's going to be a ugly, crappy version of the final product, but you just got to launch. I believe in ready, fire, aim. Get something, sell it, get it out there, screw up, and then fix it. Because I could spend all the time in the world trying to make a beautiful product, but by that time, somebody else is going to come in and steal my customers. So, I want to get in, get it started, get it going, figure out what's wrong, and then make it better.
But we're not done yet. I started by coming up with the financial goals so I could quit my job. And then I set my business parameters. And then we figured out what the pain points were. And then I put in the formula, the parameter plus painpoint plus my secret sauce. What am I good at? In this case, I'm using marketing because I already have my own in the financial space right now. That's how we got to the product. The product right now is how we're going to help dentists get more patients into their chairs. That way they can make more money because that is a big pain point. It solves these problems, but how are we going to actually get to this number?
So, let's do some math. If my tool does what it's supposed to do, and at the very bare minimum, it fills one vacancy spot a week and brings in one new patient a month, this is going to be very valuable. That new patient is going to be worth at least $1,000. And that seat, that vacancy fill is going to be worth at least at the very low end $100. And that means that a dentist's office would probably be pretty comfortable paying me somewhere between $300 to $500 a month. And this is again the bare minimum of what this app could do for the dentist. But we're going to start with the bare minimum. And because I'm new, I don't want to charge too much money. I'm going to start on the low end. So, if I wanted to go out and sell one dentist office, well, how am I going to go out and do that? I'm going to have to get dentists on the phone. And let's assume that I'm not the best salesperson because I'm not. And I might only be able to close 15% of every dentist that I can get on the phone, which is a pretty low close rate in the business of selling things. So, that means I got to get at least seven sales calls in order to be able to close one dentist. Well, for me to get seven dentists on a sales call, I'm probably going to have to have something like 21 conversations going that are pretty serious about dentists that want to learn about the business that I have. Again, I'm not talking about great conversion rates. I'm just getting started in business and I'm talking to 21 businesses that are interested and I can only get seven of them on the phone and I can only close one of them. In order for me to get 21 conversations of dentists that are actually interested in this, well, I'm probably going to have to make a lot of phone calls. I'm probably going to have to make 100 cold calls, call 100 offices to get 21 conversations to get these 21 conversations to seven sales calls to get one close. A lot of work. Yeah, I can improve these numbers, but I'm new into the business. So, I got to start somewhere.
Now, how can I go out and make this 100 sales calls as fast as possible? Well, I probably want to get a little bit of help because I know that I can get a VA in the Philippines or in India or in Pakistan and I could pay them a few dollars an hour and they can give me an Excel sheet of phone numbers of clinics to call who would be interested and it's not going to cost me a whole lot of money. I could do it myself, but if I have a job and I have a little bit of extra money, I would put my money there. That way now I can save a lot of time. And if I'm really hustling, I could make 50 sales calls a day. I can call 50 dentist offices a day between my work. or if I can't do it during my work time, then I'm going to have to make emails. And if I have to do emails, I'm going to have to do a lot more than 100 emails a day. But I have to make these calls for the purposes of this example. And now I'm going to call 50 offices a day. If I can make 50 calls a day, I can do that six days a week because there's a lot of small dentist offices that are also open on Saturdays. That means I'm going to make 300 calls a week. If I can make 300 calls a week, well, that means I'm going to be able to close three dentists a week. Now, we just do some math. If I can close three dentists a week, that's 12 dentists that I close a month. And I'm going to assume that I get a little bit of churn because I don't have the best product right now. So, I'm going to close 12 dentists every single month. But, I'm going to churn. I'm going to lose two of those dentists a month. So, I'm going to net 10 new dentists a month. That means after one year, I'm going to net 120 new dentist offices. Which means if I'm going to charge all 120 of these $300 a month, I am now making $3,600 a month reoccurring for my business. If I charge the $500 a month, I'm now making $6,000 a month from this reoccurring business. And now I'm not there yet, but I have some options. I can keep grinding away to get to the $6,700 a month number, which I'm not too far away from, or I can also start reinvesting back into my business, and I can hire another salesperson. I can hire some additional staff to grow my marketing, to grow this bigger, and to grow it faster. But I now have some cushion to go back to my job and say, you know what, I have the ability now to work on this because I know that I can grow this way faster than I can grow this. But you have some options now.
So, if my goal was to start something, that way I could quit my nineto-ive, here's what I'm going to do. Number one, I'm going to start with coming up with the goal, knowing what is the number that I need to be able to quit the job. And this is not going to be easy. This is going to be hard. There's no such thing as easy money. The only people that tell you that there's there's easy money out there are the ones that are trying to sell you a program on it.
Number two is you got to know your business parameters. You want to have revenue that is scalable. At least that's what I want because from my experience, I've learned that this is what has the biggest upside. I want to have scalable revenue potential, not linear revenue potential. I want to have reoccurring revenue. I want it to be like toothpaste. Then I want it to have high profit margins. Number four, I want it to be something that has a high pain point. And I want it to be something that people will actually pay for.
What are those pain points? Well, those pain points can be the time. It could be money. That's money saved or earning more money. It could be health. It could be happiness. Or it could be peace of mind. Once you understand the pain point, this is where you want to mix in your secret sauce because every single person has something unique to them. You might be interested in fitness, you might be interested in finance, you might be interested in video games. I don't know what it is, but you can mix that secret sauce here. You're mixing the parameters, mixing the pain, mixing the secret sauce. And now you have the potential to build a really profitable product that can make you the money that you're looking for.
And now you just got to run the numbers. How do you actually go about doing it? And the way that you get here faster is by working hard, learning, and investing in yourself. Be willing to buy books and investment. Be willing to buy classes. Be willing to buy coaching because that's what's going to allow you to get to where you want to go faster. One of the biggest things that if I could go back in time in business is I would tell myself, buy more education. Learn from people that have done it that are 10 years ahead of you. That way, you can learn 10 years of education in six months. And it's a lot faster. is a lot easier if they can just pay somebody else to save you that time.
Now, it's time for you to go out and actually make it happen. Now, I do want to remind you that if you are an investor or want to become an investor, I'll put together a free investing master class which will walk you through how I look for investment opportunities before they hit the headlines and also show you the strategies that my firm and I use to find investment opportunities before the crowd. It's a completely free master class. There's a ton of value in there. So, if you want to check that out, I have the link for you down in the description. And if you enjoy this video, the best thank you is to share this video with a friend, a colleague, a family member, or a fellow investor.
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