How to Start Your First Business in 48 Hours

Summary

In this episode of Book Club, the focus is on 'Million Dollar Weekend' by Noah Kagan, a must-read for aspiring entrepreneurs. The book is divided into three parts: Start It, Build It, and Grow It. The key takeaway is the importance of starting your business before feeling fully prepared, emphasizing action over perfect ideas. Kagan's approach debunks the myth that the right idea is a prerequisite for business success, advocating instead for a customer-first strategy. Real-world examples illustrate how to validate business ideas effectively by prioritizing customer needs and securing your first sales, providing a practical roadmap for turning entrepreneurial dreams into reality.

Takeaways

• 🚀 Start before you're ready: Noah Kagan's core message is to begin your entrepreneurial journey before feeling fully prepared, emphasizing action over perfect timing.
• 🤓 Idea vs. action: The book challenges the myth that you need the right idea to start a business. Instead, it encourages deciding to start a business first and then finding the right idea through a process.
• 🙋🏻‍♂️ Embrace the 'Now, not How' motto: Focus on taking the smallest action right now instead of getting bogged down by the 'how', which can deter action.
• 💬 Emotional support is crucial: The initial chapter provides emotional support, stressing that many aspiring entrepreneurs struggle not with technical aspects, but with overcoming emotional barriers.
• 🛠 Customer-first approach: Successful entrepreneurs prioritize understanding and serving their customer's needs over finding a business idea, emphasizing solving real problems for real people.
• 💵 Validate ideas with real transactions: The authenticity of a business idea is confirmed when customers are willing to pay for it, not just verbally express interest.
• 📌 Zone of influence: Start by identifying potential customers within your immediate network or community, ideally those with the financial means to pay for your services or products.
• 📚 Problem identification: An effective strategy for generating business ideas is to identify problems within your own life or in the lives of potential customers, suggesting that personal frustrations can inspire viable business solutions.
• 💰 Pre-sell before building: Validate market demand by selling your product or service before it's fully developed, ensuring there's a paying customer base before investing in creation.
• 💬 Talk to customers: Engaging with potential customers is highlighted as a critical step in validating business ideas, understanding their needs, and refining your offering based on feedback.

Q & A

What is the core message of the first chapter in 'Million Dollar Weekend'?

The core message of the first chapter is to start your business before you feel ready, emphasizing the importance of taking action over excessive planning.

What does the book 'Million Dollar Weekend' suggest is the first step in starting a business?

The book suggests that the first step in starting a business is deciding to start a business, rather than waiting for the right idea.

What motto from 'Million Dollar Weekend' is highlighted for encouraging action in starting a business?

The motto highlighted is 'now, not how,' encouraging individuals to focus on taking immediate action rather than getting bogged down by the details of how to do it.

According to 'Million Dollar Weekend,' what common mistake do aspiring entrepreneurs make?

A common mistake is waiting for the perfect idea before starting their business, rather than starting and finding the idea through the process.

How does 'Million Dollar Weekend' propose entrepreneurs should approach generating business ideas?

The book proposes a customer-first approach, suggesting entrepreneurs should identify a target audience and their problems before generating business ideas.

What is a key strategy for validating a business idea mentioned in 'Million Dollar Weekend'?

A key strategy is to ask potential customers for money (pre-orders or deposits) to validate the business idea, emphasizing the importance of actual commitment over verbal interest.

What does 'Million Dollar Weekend' say about the timing of starting a business?

It states that the timing to start a business is never quite right, and one should start before feeling fully prepared.

How does 'Million Dollar Weekend' suggest overcoming the 'tyranny of how'?

By taking small actions immediately, even without a full plan, to overcome the paralysis by analysis and start making progress.

What analogy does 'Million Dollar Weekend' use to describe the readiness for starting a business?

It compares starting a business to having kids, noting that just as no one feels completely ready to have kids, the same applies to starting a business.

What example does 'Million Dollar Weekend' use to illustrate the difference between the founder-first and customer-first approaches?

The book uses the example of a dog walking app, contrasting the founder-first approach, which focuses on product development without market validation, with the customer-first approach, which starts with identifying and solving real customer problems.

Outlines

00:00

🚀 Starting Your First Business: Insights from 'Million Dollar Weekend'

This section discusses the book 'Million Dollar Weekend' by Noah Kagan, focusing on its guidance for aspiring entrepreneurs. The book is divided into three parts: 'Start It', 'Build It', and 'Grow It', with an emphasis on the first two sections. It challenges the common misconception that a perfect idea is necessary to start a business. Instead, Kagan suggests that the key is to simply begin with the intention to start a business, then find a process to generate the right idea. The core message is to act before feeling fully prepared, highlighting that successful entrepreneurs prioritize action over extensive planning. The chapter promotes a 'now, not how' mindset, encouraging taking small, immediate actions towards starting a business. The importance of emotional support for new entrepreneurs is also discussed, along with a mention of Trading212, a commission-free investment platform sponsoring the video.

05:00

🤝 The Customer First Approach to Business

This section emphasizes a 'customer first' approach over searching for the perfect business idea. Successful businesses start by identifying the target audience and understanding their problems, rather than focusing solely on product or service development. The idea is to solve a problem for people willing to pay for that solution. This approach involves directly engaging with potential customers to validate the demand for your business idea, rather than assuming its viability. The discussion includes practical steps to identify customer needs and real-world examples contrasting the founder-first and customer-first methodologies. It highlights the significance of securing the first few paying customers as a validation of the business concept before fully committing to building the product or service.

10:01

💡 Validating Business Ideas and Engaging with Customers

This section further explores the concept of validating business ideas by directly engaging with potential customers. It stresses the importance of action over mere ideas, suggesting that willingness to pay is the true test of a business idea's viability. The narrative suggests looking into personal problems as a source of business ideas, providing prompts to uncover these problems. It advocates for a proactive approach to entrepreneurship, where solutions are developed based on real, validated customer needs rather than speculative ideas. The section also underscores the value of pre-selling as a method to test market demand before investing significant time and resources into product development. Finally, it encourages aspiring entrepreneurs to prioritize customer feedback and payment as the ultimate validation of a business idea.

Keywords

💡Customer first approach

The customer first approach refers to the idea that when starting a business, you should first identify customers and understand their problems rather than starting with your own ideas or solutions. As explained in the video, this involves directly asking potential customers about the issues they face and seeing if they would pay for a solution. This validates if there is a real market need. The script provides the example of a dog walking app - speaking to dog owners first uncovered that the real demand was for dog sitting.

💡Pre-sell/Ask for the first sale

Instead of building a product or service first before trying to sell it, the recommendation is to pre-sell it - get customer commitments and payments even before you've created anything. As the video says, "the first dollar is always the hardest" so by pre-selling you validate demand. For example, creating a simple landing page to promote an online course and see if people will buy it before spending time creating the actual course content.

💡Problem/solution fit

The basis of many successful companies is identifying an irritating problem that potential customers have, and providing a solution they'd pay for. Problems customers already spend money trying to solve are especially attractive. As the script notes, "a problem with a solution is a business" as long as there is willingness to pay.

💡Ask for feedback

Don't just present your business ideas, solicit honest feedback by explicitly asking customers and contacts targeted questions about issues they face and whether they'd pay for solutions. This direct customer input is stressed rather than speculation or solely founder-driven ideas.

💡Zone of influence

When identifying potential target customers, initially focus on your own zone of influence - people you already know or have access to. As a student, this would be classmates, parents, university staff etc. This makes customer discovery simpler than casting a wide net trying to understand all consumer pain points.

💡First three customers

Do whatever it takes to get your first few paying customers, even if only three initially. Their feedback and validation is invaluable for refining the product and business model. Don't wait until you have a larger customer base or finished product - build from the very first sales.

💡Premature optimization

Spending excessive time planning or trying to engineer the perfect startup idea or product before customer validation is premature optimization. As the video states, "any analysis ahead of action is purely speculation" - you need to talk to real customers early, not plan in isolation.

💡Tyranny of how

People often fail to start something new because they become fixated on figuring out the complex details of how to make it work upfront. The recommendation is to focus first on the immediate next step you can take - "what is the smallest action I can take right now?" - and tackle the specifics later.

💡First dollar hardest

Psychologically, people are much more hesitant to pay for an unproven concept or product. But if you can encourage customers to buy your initial efforts, it demonstrates real demand exists and helps overcome skepticism about the viability of the business idea.

💡Problem magnet

Cultivating the mindset to notice annoyances and friction you experience and recognize them as potential business opportunities if solutions could be offered. This relates to the discussion of how problems customers already grapple with are attractive as the basis for startups.

Highlights

Noah Kagan's 'Million Dollar Weekend' offers a step-by-step roadmap for aspiring entrepreneurs to start their own business over a weekend.

The book emphasizes starting a business by deciding to start, not by waiting for the 'right idea,' advocating for action over perfect planning.

A core message is 'begin before you're ready,' encouraging taking action despite feeling unprepared, paralleling the decision to start a business with deciding to have children.

Successful entrepreneurs act first and figure things out later, highlighting the importance of learning through action rather than overthinking.

The motto 'now, not how' is introduced, urging individuals to focus on immediate action rather than getting bogged down by the 'tyranny of how.'

The first part of the book focuses on emotional support for starting a business, addressing the emotional challenges rather than technical hurdles.

Trading212 is introduced as a sponsor, showcasing its features for investing in stocks, shares, and funds in a commission-free manner.

A customer-first approach to business is advocated, emphasizing solving problems for people willing to pay for solutions.

The importance of validating a business idea by verifying market demand before building a product is discussed.

Brainstorming who to sell to within one's zone of influence and identifying problems they face as a starting point for business ideas.

The comparison between the founder-first approach and the customer-first approach in developing a business idea, using a dog walking app as an example.

The importance of making the first sale and getting the first three paying customers as validation for a business idea.

The use of personal problems as a source of business ideas, with prompts to help identify these problems.

The strategy of pre-selling a product or service before fully developing it to validate market interest.

The emphasis on talking to customers to validate a business idea and adjust based on their feedback and willingness to pay.

An interview with Noah Kagan on the Deep Dive podcast is mentioned as a resource for a deeper understanding of the book's concepts.

Transcripts

All right, so how do you start your first business in a weekend?

That is what Noah Kagan purports to teach us in this book Million Dollar Weekend,

which is what we're discussing in this episode of Book Club,

the ongoing series where I distill and discuss highlights and summaries

from some of my favorite books.

And genuinely, this is a absolutely fantastic book to read

if you are an aspiring entrepreneur.

If you've ever thought that you want to start your own business

and you have not yet done it, you need to read this book

because it's going to give you a play-by-play roadmap

on how exactly to do that.

Okay, so the book is broken down into three parts.

We've got part one, start it.

Part two, build it.

And part three, grow it.

And in this video, I'm going to focus on part one and two,

start it and build it.

Let's go.

If you're watching this and you haven't yet started your business,

I suspect, for a lot of people I know,

you might have been thinking about starting a business for several years.

You have just not yet taken action.

And there is this pervasive myth that happens amongst

everyone who is an aspiring entrepreneur,

which is, I need the right idea.

I cannot get started until I have the right idea.

But the thing is, and what Noah talks about throughout the book,

is you don't start a business by first having the right idea

and then starting the business.

You start a business by deciding to start a business

and then you find a process to come up with the right idea.

And really, the core message he's sharing this first chapter,

which is why it's called a chapter one,

just f***ing start,

is begin before you are ready.

No one feels ready to start a business.

Just like I've heard, no one really feels ready to have kids.

The timing is never quite right.

Similarly, the timing to start a business is never quite right.

You have to just start.

You have to begin before you're ready.

And just to labour this point just a little bit more,

there's a nice quote here.

Most people overthink first, act later.

Every successful entrepreneur, act first, figure it out later.

Any analysis ahead of action is purely speculation.

You really do not understand something until you've done it.

Rather than trying to plan your way into the confidence to act,

just start acting.

And there is a motto that he talks about here.

And this is a motto that has really stuck with me

since I read the book a couple of weeks ago.

And that motto is, now, not how.

Whenever we think of doing something, we're like,

okay, well, I've got this idea for this thing,

but how do I do it?

And there's this tyranny of how.

The how holds us back from doing things.

Instead, think, what is the smallest action I can take right now?

Even if you don't know what to do about anything,

there's probably a small action that you can figure out

that you can just take action on.

And then once you've taken action on that,

you can then get started with the thing.

So honestly, the whole first chapter is a lot of emotional support.

Genuinely, I've been running my YouTuber Academy for a few years now.

We've taught like 5,000 students in it.

95% of students, when it comes to starting YouTube channels,

it's not technical things they're struggling with.

It's the emotional side of things.

They're like, oh, I couldn't possibly make YouTube videos

unless I have the perfect idea.

No one starts making YouTube videos with a perfect idea.

Just like no one starts a business with the perfect idea.

You decide to start, and then you can figure out the idea second.

Now, whatever stage of the business process you're at,

you're hopefully making some amount of money,

and then you're gonna need a place to invest that money.

And that is where the sponsor of this video comes in,

and that is Trading212.

Trading212 is a fantastic app that lets you invest in stocks,

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And thank you so much Trading212

for sponsoring this video.

So now that we've gotten the emotional support

side out of the way, that begs the question,

what happens next?

And that is where we now come

to the customer first approach to building a business.

I have interviewed hundreds of entrepreneurs on my podcast,

spoken to hundreds more in real life.

And all of them basically talk about this idea,

this customer first approach,

which is that you're not trying to find an idea

for a business.

Instead, first of all, you're starting with

who are the people you would like to serve?

Because fundamentally what a business is,

a business solves a problem for someone

who's willing to pay for that problem to be solved.

And the biggest thing that holds back entrepreneurs

and has done forever is trying to build something

without first verifying that there's actually someone

out there willing to pay for the thing.

This is the problem that students often have.

Because students come up with great ideas

and it's amazing.

They're like, I have this idea for this business.

And they'll just go and try and build it

without first verifying that there are in fact

people to pay for it.

Here we go.

That's why when it comes to generating business ideas,

customers come first before the product or service.

Even before the idea.

To build a business, you need someone to sell to.

I can't tell you how many times

someone has emailed me saying,

what do you think of this business idea?

I also get those emails.

My alter reply, have you asked what the customer thinks?

Basically, when you're trying to start a business,

the first step is to figure out

who are you going to sell to?

And that's ideally within your own zone of influence.

For example, in my position of being a medical student

at university, the people I'm serving

are probably the people around me

or the parents of the people around me

or the people I interact with in hospitals

or the people I interact with at the university

or the local businesses I interact with.

That's like within my zone of influence.

The other good thing that this customer

should ideally have is money.

It is so much easier to create a business

where you are targeting people who have money

rather than people who don't have money.

Again, this is one of the issues with students

is that if you're a student,

then everyone you know is your age

and probably does not have very much money.

If it were me and I were a student starting a business,

I might be thinking, okay,

my friends don't have any money,

but who does?

Their parents do.

Okay, what are the problems

that my friends' parents have?

Who else has money?

Like my college or my university,

there's a pot of money I can tap into there.

Okay, now that you've brainstormed

who are the sorts of people ideally with money

that you'd potentially like to serve,

the next step is to brainstorm

what are all of the problems that they have.

Now, the easiest way to do this

is to just go and ask them,

what are the things in their life

that are really annoying?

What are the things that they already pay for?

What are the things where they're paying for something

but the thing they're paying for doesn't seem very good?

And if you do this enough,

you will come up with an infinite list of problems

that people have.

And the whole world progresses and evolves

based on people discovering a problem

and then trying to find the solution to that problem.

Uber started because someone complained,

was like, oh man, it's really annoying

trying to held out a cab

and trying to ring the taxi company.

And so that's where the idea for Uber comes along.

And there's a really good example here.

So I love this.

There's the founder first approach

and then there's the customer first approach.

So here we go.

Let's say you have an idea for a dog walking out.

How would you go about doing it?

Here's the way most people,

most entrepreneurs would do it.

One, spend hours at home thinking about the app

and coming up with clever names for it.

Two, spend $100 hiring their cousin to draw a cool logo.

Three, set up an LLC.

Four, watch YouTube videos about apps

and programming and business and dogs.

Five, consider signing up for a developer bootcamp

and quickly realize that coding is hard.

Six, buy the domain name for the snazzy website

they're going to build.

Seven, look into hiring a developer on Upwork

and quickly realize it's prohibitively expensive.

Eight, give up again.

Does that sound familiar?

That is founder first.

Now let's take the same idea for a dog walking app

and let's put it through the customer first perspective.

One, call or text three people right now who have dogs

and ask them to pay you to walk their dog.

Two, turns out none of these dog owners

have problems walking their dog.

You discover their real problem is finding dog sitters

when they're traveling.

Three, ask for the next travel dates

and have them pay you a deposit.

They pay jackpot.

And the idea here is that quickly,

based on this really simple example

which I think we can all relate to in some ways,

in the founder first approach,

you go down a rabbit hole

where you build this thing

without verifying that people actually have the problem

and are willing to pay for it.

In the second one, you come up with an idea, cool.

Then you talk to people and you see,

does the idea have legs?

Would they be willing to pay you for it?

You realize, no, they don't.

And now you do something else

because you realize they are willing to pay you

for this other thing.

And crucially, you ask for that first sale.

You make that first dollar.

The first dollar is always the hardest.

The first three customers are always the hardest.

If you just aim to try and get

your first three paying customers

as soon as is humanly possible

before you even try and build anything,

then at least you have some kind of validation

that the idea has legs.

So this, for example, is an email

that one of Noah's friends, Boris, sent.

Subject, helping you help me with food.

Hey friends, one thing I realized

is that I'm busy all the time

and I don't have time to cook a quality meal.

I wanted to invite a few close friends

to test a business idea with me.

Consider yourself the lucky chosen few, smiley face.

Convenient and home-cooked meals.

On February 9th, for $20,

there will be a personal chef making us food

and delivering it to you conveniently and deliciously.

If this is something you're seriously interested in,

please PayPal $20.

Open to all and any feedback.

Cheers, Boris.

P.S. Please let me know

if you have any dietary requirements, et cetera.

I promise the dinner will be delish,

exclamation mark, exclamation mark, exclamation mark.

This is how you validate the idea for a business.

You know, you might have a business idea

and at a party you say to someone,

oh, I'm thinking of starting a business around bloody blah.

Would you be interested?

Social etiquette dictates

that they basically have to say yes.

You're very unlikely to meet someone

who will actually say,

no, I won't get about that.

But here's the crucial bit.

If you ask them for money,

be like, oh, okay, cool.

Well, you know, I'm taking pre-orders now.

Would you be willing to pay me $20 for it?

Now you see how good your idea actually is

because no one is gonna part with their money

unless they actually believe in the idea.

Words are cheap, money is not.

So if someone says, yeah, I like your business idea,

that means jackal.

What matters is, are they actually paying for it?

Have they pre-ordered the thing?

Would they be willing to be your first customer

for a 50% discount with a money back guarantee?

Anything like that.

Now, the other way to get business ideas

is to also look to your own problems.

If you find something is a problem for you,

chances are it'll be a problem for other people as well.

And there are four prompts that Noah gives us

that I fully agree with

that help us figure out what our own problems are.

So firstly, what is one thing this morning that irritated me?

Secondly, what is one thing on my to-do list

that's been there for over a week?

Thirdly, what is one thing that I regularly fail to do well?

And fourthly, what is one thing I wanted to buy recently

only to find out that no one made it?

And these sorts of prompts help you think about

like the problems in your own life.

You should sort of become a magnet for problems.

Like as you go through life,

anytime you find something annoying,

what an aspiring entrepreneur

or an actual entrepreneur does is they recognize,

I'm finding this thing annoying.

I have just identified a problem.

And a problem with a solution is a business,

assuming people are willing to pay for that solution.

Whereas what most people do is like,

they will just come across a problem

and they'll be like, oh yeah, it's just a thing.

Oh yeah, it's really annoying that we have to fill out

these like feedback forms in our lectures.

And that's where the idea will stop.

What I used to do in med school was,

oh man, it's really annoying

that we've got to fill out

those feedback forms in lectures.

I wonder if there would be

a more efficient way of doing that.

If we found the right person,

we could build a solution to this.

And when I was in med school,

I was unsophisticated with this.

I was like, oh, how might I build this?

I knew how to code.

I knew how to make websites and apps and stuff.

So I would default to like,

just trying to build the thing.

I've wasted years of my life chasing business ideas

where I was like, I found an idea,

I'm going to build the thing.

And I didn't find any customers

to pay for the bloody thing.

And I really, if someone had told me this when I was 13,

I would literally say seven years of my life

chasing down random rabbit holes

because I was afraid or didn't realize

I could speak to people

and actually just ask them for money.

The main thing is that honestly,

the way you start a business these days

is that you try and get people to pay for the thing

before you make the thing.

People come to me and they're like,

hey, Ali, I've got a bit of an audience.

I want to make an online course.

And I'm always like, okay, cool.

I know that the temptation is there to build the course

and then sell it in that order,

but you should flip that around.

You should sell the course and then build it.

So if for example, you're thinking,

you know, maybe your audience wants a course

on how to build the perfect productive desk setup.

You could go out and spend like a month

or two or three trying to create the course.

That would be a terrible idea.

Instead, what you should do is pre-sell it.

You can whip up a landing page in like a Google doc

in maybe half a day.

You can send it out to people in your audience

and be like, hey, potentially working on this course

about how to have a productive desk setup.

If this sounds interesting,

you can pre-order the course here.

It'll be released in the next month

and I'll give you your money back if you don't like it.

50% off, something to that effect.

Because based on how the pre-sell goes,

if enough people want to buy it,

then it gives you an idea.

It lets you validate the market.

So it's about finding a problem,

finding someone who's willing to pay

for the solution to that problem,

talking to those people quite a lot,

getting money from them.

And only once you have done that,

do you know that, okay,

this is a business idea worth pursuing.

And now you can start to build the thing

because you already have paying customers.

This is the thing that I wish I had known

when I started my entrepreneurship journey.

This is the thing I wish is a message

that could be hammered into the heads

of every single aspiring entrepreneur out there.

I give so many talks these days around the world.

It's super fun.

And there's always like half the audience

are aspiring entrepreneurs.

And they're all stuck in this thing of like,

oh, I need to have a good business idea

or, oh, I've just been building this thing,

but like I haven't built it yet.

And I need to make my MVP first.

And then all of it is a total waste of time.

If you speak to people who are second time founders,

people who have started multiple companies,

you'll find they spend the majority of their time

just talking to customers.

The more you talk to your customers,

the more you validate the idea actually has a market.

The more you understand what problems they have,

the more you can start to see,

huh, maybe I thought this thing should be red,

but actually this thing is blue.

The more you try and ask them for money

to pre-sell the thing that you haven't even built yet,

the more likely you are to succeed in the business.

Honestly, I think you should totally read the book.

It's absolutely amazing.

Noah's done a smashing job of it.

And if you liked this video

and you wanna see a way deeper dive into this,

I actually have an interview with Noah Kagan

on the Deep Dive podcast

that will be linked right over here.

Thank you so much for watching

and I'll see you in the next video.

Bye-bye.