Now in the previous blog, we saw how to formalize our product or service, how to think about revenue streams, and also talked about doing research on our customer base. Then comes the part where we have to launch our offer to the world & take it to the streets.

Introductory story

Let’s first look at the story of Omar and Jen. Both of them graduated from Columbus College of Art and Design in 2008. Within a year they reached burnout from the corporate world. They decided to take a trip to New York to make themselves refreshed. They looked around for a nice map to help chart their upcoming adventures but couldn’t find one so they made a unique design and printed their own. They got 50 maps printed for 500 USD since that was the cheapest offer available and no one was printing a single map. They were left with 44 after they gave 5 to friends and family. Finally, Omar asked a crazy question: Would anyone want to buy the remaining prints? They made a one-page website with a PayPal button and went to bed and woke up to their first sale. After a week, due to a surprise mention on a popular design website all their maps got sold and they got tonnes of messages begging for a reprint. It was their eureka moment and they thought could this be the answer to their burnout? Over the few months, they grew steadily and kept introducing maps of new places with new designs(new products). So basically, Jen and Omar began with an idea, kept costs low, and didn’t wait long before stepping forward with a product. Then they adapted to the marketplace response (make more maps!) and built each new product carefully.

Learnings from the above story –

The strategy we saw is to get started quickly and see what happens instead of spending a lot of time planning. There’s nothing wrong with planning, but you can spend a lifetime making a plan that never turns into action. In the battle between planning and action, action wins especially when we are talking about micro business.

Here’s the blueprint we can figure out from Jen and Omar’s story –

1. Select a marketable idea – A marketable idea doesn’t have to be a big, groundbreaking idea; it just has to provide a solution to a problem or be useful enough that other people are willing to pay for it. Don’t think innovation, think usefulness. Jen and Omar’s marketable idea was maybe they weren’t the only ones who loved beautiful maps.
   
   Now the question comes, how to know if your idea is a marketable one or not?
   
   Following are the 7 steps to instant market testing as suggested by Chris in the book –
   
   1) You need to care about the problem you are going to solve, and there has to be a sizable number of other people who also care. Always remember the lesson of convergence covered in the first part of the book.
   
   2) Make sure the market is big enough. You can test the size by checking the number and relevancy of google keywords related to your niche/product.
   
   3) The product needs to solve a problem that causes pain that the market knows it has. It’s easier to sell to someone who knows they have a problem and are convinced they need a solution than it is to persuade someone that they have a problem that needs solving.
   
   4) Almost everything that is being sold is either for a deep pain or a deep desire. You need to show people how you can help remove or reduce pain.
   
   5) Always think in terms of solutions. Make sure your solution is different and better. Is the market frustrated with the current solution? There’s no point in introducing something if the market is already satisfied with the solution. Your solution must be different or better.
   
   6) Create a persona: the one person who would benefit the most from your idea. Take your idea to this person and discuss it with him or her in detail. This will get you much more relevant data than talking to just anyone.
   
   7) Create an outline for what you are doing and show it to a subgroup of your community. Ask them to test it for free in return for feedback and confidentiality.
   
   Although these 7 steps are very useful, nonetheless we can never be too sure of whether an idea is marketable or not, and thus it is very important to start quickly and see by experiments so that we don’t waste enough money on planning and making it perfect.
   
2. Keep costs low – the second thing we could learn from the story is to invest sweat equity instead of money in the project and we can avoid going into debt and also minimize the impact of failure if it doesn’t work.
   
3. Get the first sale as soon as possible – Chris says inertia is one of the biggest enemies that entrepreneurs have to fight every day to take their business to success. People often procrastinate under the excuse of technical issues but it is their fear of failure that’s actually stopping them from making delays in taking their projects live. We have to beat that inertia and get our first sale as soon as possible as it would give us a huge dopamine rush and also be proof that the product is something that people want.
   
4. Market before manufacturing – It’s always good to know if people want what you have to offer before you put a lot of work into making it. One way you can do this is through surveys or giving your beta version to people similar to your persona. We need to make sure there is sufficient demand for our product or service before spending our whole life working on it.
   
5. Respond to initial results – After initial success, we should regroup and decide what needs to be done next. In this step, it is always beneficial to pay attention to what created the initial success even if it seems accidental or coincidental.

The on-page business plan

Now as we saw the importance of starting early and get going as quickly as possible. Chris suggests us to follow this one-page business plan instead of spending hours/days on planning and immediately get to work after this –

The 140 character mission statement

We should define the mission statement for our business in 140 characters or less. The mission statement consists of the 2 characteristics of any business – the product/service & the group of people who pay for it. It can be in the following format –
We provide [product or service] for [customers].
However, we have already seen that it is more beneficial to talk to customers in terms of benefits rather than features of our product. Hence the mission statement can be modified accordingly in the following format – We help [customers] do/achieve verb [primary benefit].

Making a lucrative offer

To make this process of taking it to the customers more profitable we should focus on making an offer the customers can’t refuse. Here’s what Chris tells us to keep in mind for that –

1. Understand that what people want and what people say they want is not always the same – for example for years airplane travelers have been complaining about crowded planes and cramped seats, and for years airlines have been ignoring them. Every once in a while, an airline creates a campaign to respond to the concern: “We’re giving more legroom in coach!” It sounds great, but a few months later they inevitably remove the extra inches of space. Why? Because despite what people say, most travelers don’t value the extra legroom enough to pay for it; instead, they value the lowest-priced flights above any other concerns. Airlines have figured this out, so they give people what they want & not what they say they want. A good offer has to be what people actually want and are willing to pay for.
2. Most of us like to buy, but we don’t usually like to be sold – An offer people can’t refuse may apply subtle pressure, but nobody likes a hard sell. Instead, compelling offers often create an illusion that a purchase is an invitation, not a pitch.
3. Provide a nudge – The very best offers create a “You must have this right now!” feeling among consumers. Providing a gentle nudge to encourage immediate action separates a decent offer from a high-performing one.

The magic formula for a lucrative offer is –

The right audience + the right promise + the right time = an offer that can’t be refused.

Following are some questions, we as entrepreneurs should be clear in order to create a lucrative offer –

Basic questions –
1) what are we selling?
2) how much does it cost?
3) who will take immediate action on this offer(persona)?

Benefits –
1) what is the primary benefit of my product?
2) what is the secondary benefit of my product?

Objections –
1) What are the main objections to the offer?
2) how can we counter these objections in front of the customer?

Timelines –
1) why should someone buy this now?
2) what can we add to make this offer even more compelling?

Tools for an amazing offer

Now we know how to think while creating a lucrative offer. Now here are some tools to help us create a good offer –

1. Frequently Asked Questions, AKA “What I Want my customers to Know” – The additional purpose of a FAQ is to provide reassurance to potential buyers and overcome objections. Our mission is to identify the main objections our buyers will have when considering our offer and carefully respond to them in advance. Now the objections to any offer fall into two categories: general and specific. The specific objections relate to an individual product or service, so it’s hard to predict what they might be without looking at a particular offer. General objections are typically the following – the customer may not know how the product works, the customer is not sure of the benefits, the customer cannot trust us with money, the customer is worried about his/her information, etc.
2. The incredible guarantee, AKA “Don’t be afraid” – Regardless of what we’re selling, the overriding concern of many potential customers is, “What if I don’t like it? Can I get my money back?” A common and highly effective way to combat this concern is to offer a satisfaction guarantee. However, we should not make our guarantee complicated, confusing, or boring. We don’t want our customers to overthink it! Keep it simple and easy.
3. Overdelivering, AKA “Wow! Look at all this extra stuff I didn’t expect” – we should make people feel good about their action of buying from us.

39-step product launch formula

The product launch is the most important step for which we might have been grinding for a few days/months. The author provides us a 39-step product launch checklist to make it a huge success –

The part towards the end of the sale is also very important to focus on because traffic usually decreases after the first 2 days, but with a little bit of effort, we can replicate the sales of the first 2 days in the last 2 days also by creating hype for the urgency of the product and making it realize to our customers that the offer won’t ever be available after this. With proper hustling, a good launch is of the following type –

During this time, it’s also important to share stories of happy customers who have purchased already.

Right before the offer goes off the market here’s where you make one final push. The message is, “It’s almost over. Here’s your last chance before you lose out.”

Hustling

Chris explains the correct form of hustling as equal talk and equal work. He suggests taking the time to make something before talking and then start with everyone we know in our surroundings and ask for feedback.

The strategic giving marketing plan

Freely give, freely receive: It works. The more you focus your business on providing a valuable service and helping people, the more your business will grow. It serves the companies interests with the customers in long term. It is about being genuinely, truly helpful without the thought of a potential payback.

The one-page promotion plan

The author suggests following this one-page promotion plan to drive customers organically instead of doing paid ads.

Money

Here Chris teaches us about 2 principles which are –
1) Businesses should always focus on profit because of no money, no business.
2) Borrowing money or investing a lot of money to start a business is completely optional.

Borrowing is no longer essential. Don’t think of it as a necessary evil; think of it as an undesirable option to be pursued only if you have a way to limit risk or are sure you know what you’re doing. Why seek investment and go into debt for something that may or may not work. It’s completely possible to start on a very low budget without hindering the odds of success.

You might expect that certain types of businesses are easier to start with limited funds, and that is correct. It’s also the whole point: Since it’s so much easier to start a microbusiness, why do something different un- less or until you know what you’re doing? Small is beautiful, and all things considered, small is often better.

The following graph shows the startup costs of all the case studies covered in this book.

What if you’ve thought it through and you do need to raise money somehow? Whenever possible, the best option is your own savings. But if this isn’t possible, you can also consider “crowd raising” funds for your project through a service such as kickstarter.com.

Parting lessons

Finally, in this section, the author tells us to remember 3 points to keep our focus on profits –
1. Price your product or service in relation to the benefit it provides, not the cost of producing it.

2. Offer customers a limited range of prices.

3. Get paid more than once for the same thing.

Now in the final part of the book, we will see how to take our business to new heights after having a successful launch.

Hi everyone, so today I am going to summarise the first part of the book called “The 100$ startup” written by Chris Guillebeau. It is one of the best and my personal favorite book on Entrepreneurship. It teaches you the fundamentals of building a micro-business from scratch with just a few bucks in your pocket. Let’s hop onto it.

Introduction

Well, the cover says “reinvent the way you make a living, do what you love, and create a new future”. But before we start, what actually this book is about and why has the author written it? So what does the first thing that comes to your mind when you hear the book name? “The 100$ startup”. Seems like a startup built with 100$, right?. But is it possible to create a startup with just a 100$?

Now, before answering this, I took a survey of several people who want to start a business but are afraid of a few things which are – not able to hire people or find co-founders, not able to raise money, confused in the paperwork of registering a startup, not able to rent a good office place and so on.

Now, this is the exact reason why Chris has written this book to teach us about doing businesses that are unconventional and don’t require what a conventional business needs, like what I just said. This book is about teaching a way of earning a good living while crafting a life of independence and purpose.

This book is exactly about stories and entrepreneurship lessons from people who built a startup with the following 5 categories.

1. Follow-your-passion model (that is build a startup around your passion)
2. Less than 5 employees
3. Low startup cost(that’s a few 100$)
4. No special skills (that is skills that can be learned in 1-2 months and don’t require 3-5 years of degree)
5. At least 50,000$ a year in net income

Let’s come to the stories – 

Michael Hannah, a 25yr old veteran sales professional was fired one fine day. While he was struggling to pay his bills, his friend who had a furniture store had some mattresses to sell. He took them on a loan and stashed them in a shop he rented. The first lot went at a slow pace but he managed to sell them all through Craigslist and word of mouth. He was very much motivated and made abrupt changes such as built a website, gave loyalty coupons to people who bought multiple times, and also took a modified bicycle to become the first mattress delivery company in Portland, and soon within 2 years he was making 6 figures.

Next comes Susannah Conway from England, a journalist who loves photography and used to teach photography part-time to friends and neighbors. Her friend made her a cool-looking website for others to book private classes from her and soon she was making more teaching photography than in her journalism job. What she did was mix her passion for photography and a way to be seen by more and more people.

Similarly, we have Kartik Gurmule from India who was a 16 yr old school student when he launched his business. He’s very passionate about entrepreneurship and marketing. He made contracts with shoe manufacturers and put up an online website for selling shoes in 2018. Within a year he was earning revenue of Rupees 56 lakhs a month.

Microbusinesses

So, welcome to the world of micro-business or micro-entrepreneurship revolution. These are businesses typically run by a single person. These have been around since the beginning of commerce but what’s new in today’s generation, however, is through the advancements of technology how quickly someone can start a business and reach a group of customers. The building process is much faster and cheaper today. Going from idea to startup with a product can now take a couple of months and cost less than 100 dollars. Commerce may have been around forever but the scale, reach and connection have changed dramatically and it’s no more an elitist club. It’s for middle-class people. We don’t need investment, nor employees, or a formal business plan. Business launches quickly without waiting for permission. Market testing happens on the fly. Are customers buying? If yes, good. If no, what can be done differently. So I blabbered a lot of things we don’t need, but then what do we actually need to build a 100$ business?

Lessons

Chris Guillebeau has said in this book that we need only 3 things to start our journey to freedom and become self-independent. Number one a product or service that you’ll sell. Number two, people willing to pay for your product or service. These will be the customers and number three, a way to get paid that is how you’ll exchange your product or service for money. The easiest way for this is to set up a PayPal account and within 5 minutes you can accept payments from over 180 countries. And see this is one of those technological advances I was talking about which has led this micro-business revolution. These 3 are the barebones of any project and the author suggests that we shouldn’t overcomplicate things.

Now to start building your product or service, there are 3 important lessons to take from the first half of the book – 

Convergence –

The first is convergence. Convergence represents the intersection between something you especially like to do or are good at doing (preferably both) and what other people are also interested in. It is the overlapping space between what you care about and what other people are willing to spend money on. Because not everything that you are passionate about or skilled in is interesting to the rest of the world, and not everything is marketable. You can be very passionate about eating pizza, but no one is going to pay you to do it. With the overlap between the two circles, where passion/skill meets usefulness, a microbusiness can thrive.

Skill Transformation –

The second is skill transformation. See many times even you don’t know what you are skilled at. People try to build businesses on the primary skill they have whereas there might be several other skills. For example, Computer Science students will be good at coding but they might have several other secondary or tertiary skills about which they can build an income source. It always helps to think carefully about all the skills you have and the combination of those skills that could be helpful to others.

Magic formula –

So, going ahead the third is the magic formula which is passion or skill plus usefulness is equal to success, and what this means is always try to provide value to others to be successful.

Value

Now, what’s value? The author defines it as something desirable and of worth, created through exchange or effort. But in layman’s terms, I would put the value as simply “helping people”. If you’re trying to build a microbusiness and you begin your efforts by helping people, you’re definitely on the right track. Whenever you get stuck, ask yourself: How can I give more value? Or more simply: How can I help my customers more? Freedom and value have a direct relationship: You can pursue freedom for yourself only while providing value for others. A business ultimately succeeds because of the value it provides its end-users, customers, or clients. More than anything else, value relates to emotional needs. Many business owners while talking to customers make this mistake that they talk about their work or product in terms of the features it offers, but it’s much more powerful to talk about the benefits customers receive. A feature is descriptive, but a benefit is emotional.

Ideas

Now, where do ideas come from? The author suggests that we should always look for opportunities such as in the form of new technology or an inefficiency in the market-place, a changing space, or a side project. And when we are thinking of ideas we should always think in terms of money as to how should I get paid with this idea? How much would I get from this idea and is there a way I could get paid more than once?

Customers

Then after you are done with your ideation and your thinking of the money-making funnel, then comes your customers. And we should always ask ourselves 2 questions about our customers which Arshad Warsi has been asking us forever –

“Kaun hai ye log? Kahan se aate hai ye log?” Which is who are your customers and where do they come from? And when you have figured out the first 2, try to answer the third which is what can you do for them? Some strategies that you should follow while dealing with customers are – number one is to dig deeper to uncover the hidden needs of your customers because many times what a customer says that he/she wants isn’t actually what they would be willing to pay for. I remember in an interview where Henry Ford said that if we would have asked people in the late 19th century that whether they wanted fast horses or fast cars, the answer was obviously fast horses. But when they made cars we all know what happened. So it’s not the customer’s job to tell you what they want, it’s your job as an entrepreneur to ask your customer what problems are they facing and then come up with a solution and give them that solution and see if it’s working or not. Now the second strategy is – make your customer a hero. This point is very important in marketing as to how you put your offer in front of your customer and how you make them believe that this product can change their life. One very inspiring story related to this is the story of a person from here India who had a net profit of 200,000 $ which is about 1.4crores and that too in the year 2009. What he did was run a training center for teaching ms-excel. Now we all know ms-excel isn’t that cool stuff but his tagline said – “Our training programs will make you a hero in front of your bosses and colleagues.” and which middle-class working Indian doesn’t want this? So this strategy is very useful to keep in mind when you want to reach your customers. The third is to sell what people buy. Many times people first make a product and then take it to the market. Instead first look for problems people have and then build a product to solve that.

Summary

Formalizing, we can put 6 steps to getting started right now –

1. Decide on your product or service.
2. Setup a website.
3. Develop an offer.
4. Ensure you have a way to get paid.
5. Learn from steps 1-5 and repeat.

Now once you are done with formalizing your product or service, you have thought about revenue streams and also did your research on your customer base. Then comes the part where you have to launch your offer to the world for which we need to cover the second part of this blog. So see you guys in the next blog.