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What Business Model is Right for You?

UnrealCreative

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How often do you see someone "fall into" an entrepreneurial path, without careful consideration whether their path was right for that person?

Inspired by this insider's thread by @MTF, and as I approach my own first exit, I've thought a lot about Business Models. There's a lot I didn't know two years ago when starting out obviously. But had I given the business model more thought, it's my belief that I'd have a business that flourished rather than one that just pays the bills. My sole regret in entrepreneurship to date is "jumping in" to a business without more careful consideration of whether or not I, PERSONALLY could make it a success.

So. Although CENTS is a GREAT business model framework, there's a lot I know I DON'T want in the next business model that isn't taken into account by CENTS.

For example...

1: Competition & Commoditization. New copycat companies pop up every weekend, it's insane. In the next business, I want to win based on the inherent value of the product I provide. Not by who can sell better. Competition has to be either complacent or nonexistent.

2: Little Interaction with Customer, Before and Post-Sale. Services lends itself heavily to client interactions...from the sales process, through fulfillment, all the way through post-sale which I've grown tired of. I'm decent at driving PPC traffic for my own business and getting you on the phone to buy stuff, but that doesn't mean I want to. The next business model will require as little interaction from the customer as possible, such as physical goods or digital products.

3: I don't believe in the service and hate the industry as a whole, for many reasons. I had only jumped in because of the MRR component and it was something I knew how to do. Next business will be in something I can at least NOT hate. Being in an industry, whether you're an entrepreneur or not, is a miserable existence.

From this list, I can begin to expand on and consider a longer list of personal criteria for the next business model. I understand that this will shut me off from opportunities that exist outside this criteria, but I'd rather run with a business that is a better personal fit (and thus has a higher probability of success) than a HUGE opportunity with a low probability of success because it wasn't a good personal fit. I'd also probably be miserable.

I have a few dozen other things I could weigh a business model's personal worth to me, but am curious to hear from everyone:

Beyond this list, What is YOUR personal criteria for going into a business?

...Or is it even a thought before jumping in?
 

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Last edited:

DrScream

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I'm only 24 so my list has been, at times, rather short...

I changed business models about 4 times in the last year because I kept falling for that shiny object syndrome. I started out with selling hats & shirts with Corgi's on them. I made a couple sales and then decided that I wanted to do something different.

I stumbled upon CBD Oil as a rising industry & got into that about 3/4th of the way in and ultimately decided I didn't want to sell some Chinese products that could potentially poison animals and left that industry too.

Then I went into iPhone screen repairs and realized that everyone and their mother was starting up a phone repair shop on every corner so the profit margins had already been battled out to the bottom.

I've still got my LLC set up and am in the stage where I'm deciding whether to dissolve it while meditating on sharpening my radar for that problem language so that I can spot any issues people are having which could be turned into a solution product.

My only real prerequisite at this time is that it actually has a decent amount of golden gumballs (to steal an analogy from MJ).
 

Johnny boy

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My criteria for going into anything is this:

I have to have an angle.

I'm not a small margins guy. I don't flip things to make a couple bucks. I have to see a hole in the market that others don't see. If it comes down to just whoever is working harder, then I'm not going to be that far ahead of anyone. I don't like fair fights, foot races, etc. I want to win, not compete.

If you can't be lazy, you have a bad business model.

I am a creative person who thrives on chaos and lack of structure.

In every single thing that I pursue, I can easily list off my "angles" that give me an advantage over the status quo. And that's my criteria.
 

Timmy C

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I don't want to deal with people all day everyday.

Free time is more important to me than money.

Digital or physical products is my criteria, will little customer service, non existent or outsourced.

The thing I like about my classes and courses I have is I make the courses and after that I have done basically nothing and am still making sales.
 

SamRussell

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Something where I get MRR for doing what I do. The best business model I can think of is a fanclub, but I need to massively increase my online presence and my skills to make that worthwhile for the end user.
 

MHP368

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Counterpoint. If the demand exists then even if you dread it who cares? Grind it out until you can hire employees and a manager.

Even if the idea doesn't have legendary money wings , can it replace your current job and then some and maybe lead to a buyout that will position you well for a truly inventive endeavor in 3 or 5 years?

Plenty of service businesses meet this criteria , you're not going to be re-inventing the wheel just taking a slice of the pie. You wont have an 8 figure payday but if it makes money why not?

You could be on the sidelines forever trying to find some business that checks all the boxes or you can get in the world and start solving peoples problems for money.
 

Entre Eyes

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Counterpoint. If the demand exists then even if you dread it who cares? Grind it out until you can hire employees and a manager.

Even if the idea doesn't have legendary money wings , can it replace your current job and then some and maybe lead to a buyout that will position you well for a truly inventive endeavor in 3 or 5 years?

Plenty of service businesses meet this criteria , you're not going to be re-inventing the wheel just taking a slice of the pie. You wont have an 8 figure payday but if it makes money why not?

You could be on the sidelines forever trying to find some business that checks all the boxes or you can get in the world and start solving peoples problems for money.
You reminded me of the guy I think his new brand is Youpreneur but he previously flew to Philippines, set up an Outsourcing company then outsourced himself from the daily operations and moved to his next projects.

That was pure gold. :)

Sometimes the best I.M. books/resources are from observing the real choices others have made that proved to be successful.
 

100k

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Honestly, the rules MJ set are pretty spot on.

I wouldn't bother with anything that didn't meet the CENTS requirements.
As far as passion is concerned, I could care less. I'm there to provide value and help people/businesses by solving problems for them in return for $$$.

Def. don't want to jump on the phone with people or deal with customer complaints, find a way to outsource that to people/companies that love handling that stuff and give them a cut of the proceeds.

Just focus on the thing you can do that provides value, and build systems that takes care of the rest.

Your goal should be to be the visionary, the maestro, the conductor, the general, the captain that steers the ship and sets the strategy.

View: https://www.youtube.com/watch?v=TD7WSLeQtVw
 

Andy Black

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My criteria is that it matches CENTS, that I am motivated by it helping people in a big way, that there are many legs that could be built for the same stool, that it involves using my super-powers, and that I’m fascinated by it more and more each year.

I love MRR, but one off sales of a course I built over 2 years ago is pretty amazing too.

The best reason I heard for starting a business is that it’s something you can’t NOT do. What are you compelled to do every day, even when you try and stop yourself?

I wonder if it’s less about the business model, and more about who you’re helping, what you’re helping them with, and how you do it?
 

Andy Black

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Your goal should be to be the visionary, the maestro, the conductor, the general, the captain that steers the ship and sets the strategy.
I agree, *and* I also think we can be the practitioner at the same time. I think there’s too much emphasis on people removing themselves from the coal-face. What if you like and excel at the coal-face work? In today’s world it’s possible for practitioners to build nice businesses around a skill (by becoming better business owners too).
 

MTF

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Counterpoint. If the demand exists then even if you dread it who cares? Grind it out until you can hire employees and a manager.
Because life can be much shorter than you expect and you can waste a good percentage of it doing something you dread. You won't find a perfect business model, but finding one as closely aligned to your personality as possible will make everything easier and more enjoyable.

The phrase "Grind it out until you can hire employees and a manager" is a great example of something that is easier said than done. Many entrepreneurs get stuck in businesses they dread which they started with the same plan of hiring employees and managers only to realize that working on a business you hate makes it very tricky to grow it to the point you can afford employees.
 

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Andy Black

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Because life can be much shorter than you expect and you can waste a good percentage of it doing something you dread. You won't find a perfect business model, but finding one as closely aligned to your personality as possible will make everything easier and more enjoyable.

The phrase "Grind it out until you can hire employees and a manager" is a great example of something that is easier said than done. Many entrepreneurs get stuck in businesses they dread which they started with the same plan of hiring employees and managers only to realize that working on a business you hate makes it very tricky to grow it to the point you can afford employees.
I have zero interest in having employees and a manager. It may happen, but it's not a goal.
 

Madame Peccato

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I'm still at the beginning of the journey, and as of right now I'm figuring out how to operate service-based businesses, and eventually expand into digital products.

I have no interest in physical products as that seems like a huge headache to me for a number of reasons, although I have a couple product ideas I will try out when I have some more cash / freedom of maneuver.
 

MitchM

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Just like you, I've been doing this for two years - but in eCommerce.

The main thing for me is that I have to believe in the product and it has to be a no-brainer for customers.

I have so many ideas for products, but my main desire is that it tangibly improves people's lives. One of my favorite things from my current business is receiving great customer feedback.

I'm not a marketer or anything like that, so something I really want with my next business is to start a product that will have enough sales from PPC traffic alone for me to hire out those other positions and start marketing to cold traffic.

So:

1. I must believe in the product.
2. The product must be a clear choice for customers (either no competition, or competition that I destroy).
3. There must be enough initial volume for me to support hires that will expand the business.
4. Obviously, CENTS.
5. Great margins.

Right now, my current products are swimming with so many other players. While I believe it is the best, I just can no longer be passionate about it - and although the revenue is enough to get one other person on board to start with marketing - it would cripple me financially and make me have to live on a tight budget... and all of that would still be a gamble.

SO, thankfully I am currently working on a product that does meet those 5 criteria, and I can start up while my current business runs passively.
 
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UnrealCreative

UnrealCreative

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f it comes down to just whoever is working harder, then I'm not going to be that far ahead of anyone. I don't like fair fights, foot races, etc. I want to win, not compete.

If you can't be lazy, you have a bad business model.

I am a creative person who thrives on chaos and lack of structure.
This is so, so good. We sound very alike in our line of thinking. This is what I'll be looking for in the next opportunity.

Counterpoint. If the demand exists then even if you dread it who cares? Grind it out until you can hire employees and a manager.
Because it's extremely hard to grow a company if you don't believe in the service you offer, despite market demand. What prompted this conversation is I'm exiting soon after having run it for 2.5 years.

There's a lot I'd do differently, i.e. not jumping into another business just to take a slice of the pie. I'm not a total noob and will have the financial runway and mental headspace to think of a better opportunity to pursue, knowing what I know now.
 

foodiepersecond

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I'm only 24 so my list has been, at times, rather short...

I changed business models about 4 times in the last year because I kept falling for that shiny object syndrome. I started out with selling hats & shirts with Corgi's on them. I made a couple sales and then decided that I wanted to do something different.


My only real prerequisite at this time is that it actually has a decent amount of golden gumballs (to steal an analogy from MJ).
You may reprise this when they drop the new Cowboy Beebop series since one of the characters is a corgi named Ein.
 

Champion

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For me its supplements.

People want the quick-fix and i'll gladly give it to them!

However, what makes my products different, is the experience I take my customers through.

I dont just give them what they WANT (the quick fix vitamins/supplements).

I also try to give them what they NEED (healthy habits & routines, proper goals, as well as a positive mindset).

When the customers notice how much energy im authentically putting into helping and see'ing them succeed, they become loyal for a long time.

Everything I just wrote up in this post is still only in my head and currently crystallising as a very clear vision in my mind. I have never been able to visualise my success this clearly. I will make my business model work.

In a couple of years from today, im certain that I will look back at this post with a grin in my face, enjoying my millions by a sunny beach somewhere and sipping Piña Coladas baby!
 
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payingkarma

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My criteria for going into anything is this:

I have to have an angle.

I'm not a small margins guy. I don't flip things to make a couple bucks. I have to see a hole in the market that others don't see. If it comes down to just whoever is working harder, then I'm not going to be that far ahead of anyone. I don't like fair fights, foot races, etc. I want to win, not compete.

If you can't be lazy, you have a bad business model.

I am a creative person who thrives on chaos and lack of structure.

In every single thing that I pursue, I can easily list off my "angles" that give me an advantage over the status quo. And that's my criteria.
Very interesting.. can you explain this by the way of an example..
I.e., the hole, the angle and the opportunity...
 

Johnny boy

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Very interesting.. can you explain this by the way of an example..
I.e., the hole, the angle and the opportunity...
I do website and marketing consulting on the side and charge hundreds of dollars per hour.

My website is professional. I refer to myself as “an account manager here at the company” to sound big. I have all of the benefits of a large company doing website and consulting work but it has 0 costs and it’s hard to tell the difference.(I justify it because I know I’m smart and the advice I give is great for them anyways)

I can do incredible work with WordPress. I can build out amazing systems that can give the same effect as what you would pay a company 30 grand to set up for you coding it themselves. But I can use what others have done and set things up in hours.

My entire angle is that I can do big business level work with an incredibly short amount of time and spending nothing, all because it’s done with systems that are already built and 99% of the time don’t require a ton of coding to make things work. And I can do all of this while appearing to be a big firm, but not having to invest the same resources into becoming an actual large firm with tons of expenses. None of those expenses help grow a business of a client.

Would I build websites if I had to be a “freelancer” and get paid a couple hundred bucks to build you a site? Nah. Would I take the 10 years to go to school, learn how to code, get experience, grow a big web design and consulting firm, etc? Nah. Takes too long. I can get a similar effect with a snazzy website, some ads, using WordPress, some marketing experience, and pretending to be a big firm.

Always have an angle. Something that gives you an advantage over the other suckers who toil away and waste their time because they did things the normal way.
 

Silver shadow

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My criteria for going into anything is this:
If you can't be lazy, you have a bad business model.
This sounds a lot like me. Hard work as a continuous, never ending prerequisite for making a living via entrepreneurship is not how to live. Sure some hard work is required in the initial stages; to build and set the system. But that's about it. A business model needs to afford me time and space to be lazy and do the other things in life that I enjoy.
 

Kevin88660

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Cash flow.

That is what suits my style. I prefer to have a weighing scale while I am losing weight. I need the P and L to validate my trading strategy.

I just hate to constantly doubt If I am doing the right thing or in the right direction.
 

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