I Discovered The Easiest Million Dollar Business to Start in 2024

Summary

The video script discusses the pros and cons of starting an education or coaching business versus a traditional business. It highlights that while digital education businesses can quickly reach $1 million per year, scaling to $100 million is challenging due to low retention rates and key man risks. Traditional businesses, though slower to start, can create more substantial, sellable assets with higher potential for growth and exit value. The speaker emphasizes the importance of understanding one's goals, operational capabilities, and commitment to making a successful transition between business models.

Takeaways

• 💼 The easiest business to start that can make a million dollars a year is also the hardest to scale to a hundred million due to inherent limitations in the business model.
• 📚 The education or coaching industry is highlighted as an example, where the speaker has personal experience, having achieved significant sales and an exit in the industry.
• 🔑 The script discusses two primary considerations for starting or transitioning into an education or coaching business: the goal you're solving for and the problems you're adept at solving.
• 🚀 Coaching and digital course businesses can quickly reach $100,000 to $200,000 a month, but scaling to a billion requires overcoming significant challenges.
• 🎯 The goal of selling a business for a large sum is not well-aligned with the information or coaching business model, as the success rate for such high valuations is low.
• 💰 For those aiming to make $1 to $3 million per year, the information or coaching business can be a fast and straightforward path, but it comes with challenges in revenue retention and key man risks.
• 🔑 The speaker emphasizes the importance of operational skills and leadership for scaling a business beyond the initial success phase.
• 🛠️ Sticking with a traditional business model may be better for those seeking a high-value exit, as it allows for the creation of a sellable asset that does not rely on the founder's personal brand.
• 🤔 The decision to switch from a traditional business to an education business or vice versa should be made with clear commitment and without maintaining appendages of the old business.
• 🚧 Transitioning between business models requires a full commitment and focus; maintaining both models simultaneously usually leads to suboptimal results.
• 🌐 The script offers insights into the mindset and strategies for scaling businesses, emphasizing the need for focus, operational infrastructure, and leadership to achieve long-term success.

Q & A

What is the easiest business to start to make a million dollars a year according to the speaker?

The speaker suggests that coaching, information, education, digital course, and membership businesses are among the easiest to reach $100,000 a year or even $200,000 a month, but they are also the hardest to scale to $100 million a year.

Why is the education space referred to as 'wink wink' by the speaker?

The speaker uses 'wink wink' to imply that the education space is the business model he is going to discuss, and he has personal experience and success in this industry, having sold his last business for 46.2 million.

What are the two types of people the speaker wants to address in the video?

The speaker aims to address people who want to start a business and those who already have a business and are considering switching into an education or coaching business.

What are the two biggest considerations for someone considering an education or coaching business?

The two biggest considerations are identifying the goal one is solving for and assessing which problems one is better at solving, whether those inherent in the education business or the opportunities and problems in a traditional business.

Why are coaching and digital course businesses not ideal for someone aiming for a large exit, like $100 million or more?

These businesses are not ideal for large exits because they often rely heavily on the personal brand and involvement of the owner, making them difficult to scale without the owner's direct participation and less attractive for buyers looking for a sustainable, independent asset.

What is the common challenge faced by businesses in the $2 to $3 million a year range?

The common challenge is the lack of operational infrastructure and leadership skills needed to grow beyond that point. Many entrepreneurs hit a cap in their operational skill set, not knowing how to lead or manage effectively to scale further.

What is the key to making a decision and committing to one business model over the other?

The key is to eliminate alternatives and focus on one path. Commitment is defined by the ability to say no to other options, and successful entrepreneurs are those who can make a clear decision and fully dedicate themselves to one business model.

What are the lifestyle benefits of choosing the education or coaching business model?

The lifestyle benefits include the potential for higher and faster income generation, the ability to sustain a higher lifestyle, and less need for reinvestment of profits compared to traditional businesses that require capital for physical expansion.

What is the main advantage of a traditional business model in terms of long-term value creation?

The main advantage is the potential to create a valuable, sellable asset that is not reliant on the owner's continued involvement. With proper scaling and brand building, such businesses can achieve high valuations and provide significant exit opportunities.

How does the speaker suggest testing a new business model or strategy?

The speaker suggests testing a new model or strategy by implementing it as if it were a full rollout, using a representative sample of customers from different market segments and skill levels to gather comprehensive feedback and data.

What is the 'test kitchen' fallacy mentioned by the speaker, and why is it not applicable in the context of an education business?

The 'test kitchen' fallacy refers to the idea of keeping a part of the old business to test new processes or strategies. The speaker argues that this is not effective in education businesses because the methods of teaching and scaling are different, and maintaining such an appendage can divert focus and resources away from the main business.

What advice does the speaker give to those who have been successful in the education business and are considering a switch to a traditional business?

The speaker advises making a clear and committed transition, selling or cutting ties with the education business to fully invest in the new venture. He emphasizes the importance of not straddling the line between two business models and the need to focus on one to achieve significant success.