How to Start a Business from Scratch and Get Your First Customers

Introduction

• Objective: By the end of the lecture, you will know what business to start, who to serve, how to serve them, and the exact message to get your first five customers.
• Authority: Co-owner of school.com, helps tens of thousands of people monthly start their first online business.
• Success Rate: 1 out of 2 people who start a paid community on school make their first dollar.

Framework Overview

• 5 Parts of Framework
  • The What: Define your business.
  • The Who: Identify your target audience.
  • The How: Explain how you will help your customers.
  • Combining Everything: Create a compelling proposition.
  • Unique Mechanism: Develop a unique angle that sets you apart.
• 2 Bonuses
  • Advanced techniques
  • Next steps to make your first dollar

Part 1: The What

3 Ps Framework

1. Pain
   • Example: Organizing lunches for 9 kids
2. Profession
   • Example: Teaching registered dietitians how to bill insurance
3. Passion
   • Example: Fitness obsession leading to personal training

Key Insight

• Iteration Process: The initial idea doesn't need to be perfect; it just needs to start the iteration process. Over time, a "bad idea" can become a good idea.

Part 2: The Who

Categories of Target Audience

1. People Like You
2. People You’ve Helped Before
   • Example: Helping a friend with food planning
3. Underserved Market
   • Example: Emerging trends with high demand but low supply

Defining Your Audience

• Use age, gender, profession, problems/pains, and interests/passions to narrow down your avatar.
• Three Critical Factors: At least three identifiers to clarify the audience (e.g., 35-year-old male accountants who are bored at their jobs).

Misconception

• Narrowing Focus: Being more specific can actually allow for higher pricing as it addresses niche markets more effectively.
• Example: Time management generalist vs. time management specialist for outbound sales reps in garden and power tools.

Part 3: The How

How Part 1: Upside (Positive)

1. Easier
2. Guaranteed
3. Faster
4. Desired Outcome
   • Example from Gym Launch: $30,000 in 30 days

How Part 2: Downside (Negative)

1. Risks Avoided
2. Slowness Avoided
3. Pain/Sacrifice Avoided

Specific Strategy

1. Retain Good Habits: Avoid giving up things you like.
2. Avoid Bad Habits: Avoid starting things you dislike.

Customer Insight

• Conduct interviews to learn about customers’ pains and aspirations.

Part 4: Combining Everything

Basic Template

• Mad Lib Format: I help [Who] get [Good Stuff] without [Bad Stuff].
• Examples:
  • I help 35-year-old male accountants get a new income stream without long hours.
  • I help 45-year-old women who just had kids get back into their high school jeans without giving up time with family.

Advanced Level

• Add a unique mechanism to make the proposition more compelling.
• Example: P90X uses “muscle confusion”.

Bonus: Unique Mechanism

• Importance: Differentiates your solution from the competition.
• Structure: Can be a list or series of steps wrapped and named as a proprietary process.
• Examples:
  • Weight Watchers: Point System
  • P90X: Muscle Confusion

Final Steps: Getting Your First Five Customers

Simplest System

1. Greeting
2. Compliment
3. Value Proposition Sentence (from combining everything)
4. Ask for Referrals

• Time Commitment: 4 hours per day or until 100 contacts
• Conversion Rate: This approach helps secure the first five customers.

Additional Resources

• School.com Games: Community and frameworks to help build and launch your first business.