Chris Guillebeau wrote “100 Startup,” sharing some stories of some unexpected entrepreneurs who have never thought of themselves as businessmen or businesswomen.
Other books in the market talk about the rise of internet startups, tales of in-house organic restaurants, or write down 80 pages business plans that don’t resemble how the actual business operates.
This book, “$100 Startup,” has two themes. Freedom and value. Freedom is what we are looking for, and value is the way to achieve it.
- The $100 Startup
- Part 1 – Unexpected Entrepreneur Entrepreneurs
- Part 2 – Taking It To The Streets
- The $100 Startup Summary, Chapter 6 : The One-Page Business Plan
- The $100 Startup Summary, Chapter 7 : An Offer You Can’t Refuse
- The $100 Startup Summary, Chapter 8 : Launch
- The $100 Startup Summary, Chapter 9: Hustling : The gentle art of self-promotion
- The $100 Startup Summary, Chapter 10: Hustling : Show Me The Money
- Part 3 – Leverage $ Next Steps
Part 1 – Unexpected Entrepreneur Entrepreneurs
The $100 Startup Summary, Chapter 1 : Renaissance:
“It’s been an amazing two years since I lost my job”Michael Hanna.
Chris Guillebeau shares a story of ‘Michael Hanna,’ who had been fired from his job on a Monday morning of 2009. After receiving unemployment checks and searching for job leads, he understood that it’s tough to return to a well-paying job at the same level he worked at before.
So Michael and his wife ‘Mary Ruth’ started selling Mattresses by offering free delivery by cycle. within two years, their business grew, and Michael had enough money to support his family. Chris shares some stories of micro-entrepreneurs who had no business experience, no training, and almost no money but turned their passion into a profit-generating business.
The $100 Startup Model:
In preparation for writing this book, Chris gathered data from more than 1500 respondents from 63 cities of North America. All of the respondents met at least four criteria of the six criteria listed below –
- Follow-your-passion model
- No special skills
- Low startup cost
- Net income $50000 at least in a year
- Fewer than five employees
- Full financial disclosure
Lesson 1: Convergence
Convergence is the intersection between what you care about or are good at doing and what other people are willing to spend money on it. A microbusiness can be built on freedom where skills or passion meets usefulness.
Lesson 2: Skill Transformation
Most of the people around us are born with multiple skills. For example – teachers are not only good at teaching but also they are good at communication, crowd control, adaptability, coordinating with different groups, lesson planning, etc. These bunch of skills can be used in building a business. The simplest way to understand skill transformation is to realize that you’re skilled at more than one thing.
Lesson 3: The Magic Formula
Skill or Passion + Usefulness = Success
If you are passionate or skilled at something, merging your passion with usefulness and sharing it with a large community can make your businesses successful.
Keep in mind –
- What you sell: products or services
- Who are your customer: people willing to pay for your products or services
- How you’ll exchange a product or service for money: A way to get paid
If you have nothing to sell but have many people, you don’t have a business. If you have something to sell, but no one is willing to buy it, then you have no business. To be an entrepreneur, you need to merge all the three things.
The $100 Startup Summary, Chapter 2 : Give Them The Fish:
Give a man a fish and he will eat for a day. Teach a man how to fish and you feed him for a lifetime.Chinese philosopher Lao Tzu, founder of Taoism
It can be more advantageous to teach a person how to do something rather than do something for that person. However, this proverb works perfectly for a hungry fisherman. But It’s a terrible idea when you are in business. Think as if you are in a restaurant to have a delicious dish. You don’t want to go to the kitchen to learn how to cook the fish. You just want the dish.
Chris illustrates a story of ‘John‘ and ‘Barbara‘ who are the owners of the V6 Ranch for the people who want to escape from their tedious life and search for freedom in their life. Rather than jetting off on a beach in Hawaii, people choose to visit a working ranch to escape and be someone else. V6 ranch offers freedom and sells happiness.
Kelly Newsome’s yoga practice gives serenity to stressed-out Washingtonians. She knows more than anyone about the pressures of the rat race as she was an ex-lawyer. These two businesses don’t provide value as horse rides or yoga classes. ‘Horse rides’ and ‘Yoga classes’ are the features of the those businesses and the ‘freedom’ and ‘relaxation’ are the values/benefits the people get from the features.
Chris Guillebeau shares some strategies in applying the $100 Startup
- Dig deeper to uncover hidden needs
- Make your customer a hero
- Sell what people buy
He also suggests marketing core benefits rather than a combination of features. Features relate to physical needs, and benefits relate to emotional needs. He also advises offering more of the things like love, attention and less of the things like stress, anxiety, debt in a business. If you are focusing on improving others’ lives, you will always get paid and make business.
The $100 Startup Summary, Chapter 3 : Follow Your Passion Maybe
“Get paid to do what you love by making sure it connects to what other people want.”
Chris narrates the story of ‘Gary Leff’ who is the CEO of two university research centers. In addition, he is a ‘travel hacker,’ providing consultancy services for executives who don’t have time and knowledge of booking a trip. Gary earned $75,000 in a year from this side business.
“I honestly do this because it’s fun”Gary Leff
Chris shares some tricks, tips, and templates to start a new business as a consultant in this book. You can download the “instant consultant biz” template @100startup.com
This is not always how you make a business from your passion. Think about the formula:
(Passion+skill)+ (problem+marketplace)= opportunity
When your passion merges with a skill that other people value, you can easily make a business with that passion.
The $100 Startup Summary, Chapter 4 : The Rise of Roaming Entrepreneur
Chris Guillebeau provides some examples of roaming entrepreneurs in this chapter who live a luxurious life and earn six figures in a month.
Brett Kelly, A self-described “professional geek,” published a PDF describing every trick and tips of Evernote that bring him around $120000 each month. There are so many ways to become financially independent. However, the information publishing business is quite profitable and easy. Chris share some tips on how can you become your own publisher in this chapter-
5. The New Demographics:
Kinetic Koffee Company(KKF) grew its business by targeting a specific group of people who are skiers, cyclists, backpackers, and enjoy outdoor life.
Kris Murray, a consultant, knows how child care providers make their businesses more effectively. However, local providers can’t succeed because they don’t want to develop their business. So she targeted multi-location business owners and offered diversified products and services. By doing this, she made $20000 in a month.
Nowadays, creating business and making money is simple. You need to fix what you offer and to whom you offer it. You can’t pursue different projects at the same time. Chris provides a decision-making matrix that helps you to evaluate the best project among multiple projects. This matrix helps you to evaluate the strength and weaknesses of your projects.
Part 2 – Taking It To The Streets
The $100 Startup Summary, Chapter 6 : The One-Page Business Plan
You can go with your plan to respond to the changing needs of your customer. However, you need to execute your business plan as soon as possible. Otherwise, other people will execute that idea.
Chris provides seven steps to execute the business plan into instant market testing. you can follow the following steps-
1.There should be a sizable number of people who will benefit from your product/service.
2.Make sure the market is large enough and think about how you will search for your products. If you get a suitable keyword with a good monthly search volume, you can execute your business idea.
3.The product should solve a problem and serve the customer who has the problem and searching for a solution.
4.Everything can be sold for either a deep desire or deep pain. Satisfying a desire is less effective than removing a pain. If you want a quick response, you need to work on how you can help remove or reduce the pain.
5.Go in the market with a new solution or idea. If the market is already satisfied with the old solution, you need to provide a different or better solution than the others in the market.
6.Make sure you create a persona. Discuss your business plan with the person who would benefit most from your idea. You also can get recommendations from that person.
7.Build trust and value by asking the community to test your product/service for free. You will get free feedback from them and build confidentiality.
To make your plan into action, you can do the following things –
- Select a marketable plan
- Keep costs low
- Get your first sale as soon as possible
- Market before manufacturing
- Respond to initial results
To avoid overcomplicating things, write down a 140-word statement that will describe your business’s mission and vision.
The $100 Startup Summary, Chapter 7 : An Offer You Can’t Refuse
Chapter seven talks about the step-by-step guide to creating a killer offer. Creating an offer is itself a very important stage of the marketing game with its own rules, so Chris has set them down for all of us.
Rule one – Make sure what you’re offering is being offered at the right time.
Chris tells a story about running his first marathon, and about halfway through the marathon, people were handing out orange slices. He took one piece of it and kept on running, and then a little bit further down the road, there were people handing out donuts.
He didn’t want to eat the donuts because he still had half a marathon to run. So that was an example of an offer that would have been appreciated because most people like donuts. But it was at the wrong time.
When Chris reached the end of the race, he would’ve gladly bought some donuts because he needed carbohydrates. So make your offer at the right time.
Rule Two – Make sure you’re giving people actually what they want, not what they say they want
People say that they want more legroom in an airline, but actually, they want the cheapest seat, and in fact, now the many airlines are pricing over half of their seats as premium economy because they have some inch and half of more legroom.
People are upset. After all, they can’t get the cheapest seats because someone else got the cheapest seat book for the next three months. Airline figured this out and made an offer that people wanted and were willing to pay for it.
Rule Three- People like to buy, but they don’t like to be sold
Chris says that you don’t want to sell people things; you want to invite people to join things. The thing that they’re joining just happens to have a price tag attached to it.
Rule Four – FAQ, Overdelivary, and Guarantee
You have to provide a frequently asked questions page and a guaranteed page and immediately offer reassurance after someone buys something from you. This makes a great relationship with your customer.
The $100 Startup Summary, Chapter 8 : Launch
Chapter 7 talks about creating an offer. However, chapter 8 is about putting the offer on your website and telling you to make a mailing list. A launch has several steps.
Step 1- Telling your product story in advance.
You need to tell your audiences –
What is your product?
Why is your product important to them?
What do they actually get when they buy your product?
After that, you have to make a plan for the launch.
Step 2 – Make a plan for your launching Campaign.
If you have some limited-time offer, you can get a few more sales than traditionally offering something for your audiences.
You need to fix the time when you want to launch your product and fix the time period for the launching campaign. People will jump to buy your product because they are afraid of missing out on your offer.
Step 3: Inform Your Audiences
Publish the launch date and time in advance and inform your audiences through email. You also mail your audience to force them to buy your offer.
“You have only 24 hours left to get this special offer. So, You have to buy it now or you will lose it forever.”
The $100 Startup Summary, Chapter 9: Hustling : The gentle art of self-promotion
In this chapter, Chris Guillebeau illustrates three icons representing the difference between a successful and an unsuccessful business that you may promote for sale.
A Charlatan is all talk, getting people to talk about an offer but have nothing to offer.
Style without substance = flash
A Martyr is all action with a combination of good work to talk about but unwilling or unable to talk about the offer.
Substance without style = unknown
A Hustler represents both. Good work to offer something and talk fused together.
Style with substance = impact
Setting up a project which is good enough to go and share with your audiences. At first, you may not be able to gather too many audiences to subscribe to your offer.
So make a list of fifty people ( colleague, College friend, acquaintances, etc.) and send them a quick note as soon as you launch your offer.
“If half the work is building the house and the other half is selling it.”
First Things First, decide what you want to say to your audiences and why they want to know about it.
Next, you can use the strategic giving marketing plan to capture your customer’s attention. Create custom products and give them to two or influential bloggers.
When they write about it, tons of new customers will come shopping. “Freely give, freely receive” policy will help you to grow your business quickly.
Strategic giving is a great tool to gain trust by giving genuine and helpful advice without expecting a potential payback.
However, strategic giving marketing plans work in the long term. So, you need to build good relationships with your potential customers.
Say ‘YES’ to every Opportunity if you feel so-so about it rather than thinking about the merit and demerit of the Opportunity.
You can arrange a contest or giveaway to generate a large number of audiences; those in the future may turn into your customer.
Make a Ten-hours marketing plan. Marketing is like sex. Only losers pay for it. So, before showing your offer to your audiences, make it marketable.
However, Chris conducts an unscientific experiment to measure the expense of Ad and hustling. Hustling cost less than ad costs. You need to spend some extra hours writing a guest post, make contact with audiences, etc.
The $100 Startup Summary, Chapter 10: Hustling : Show Me The Money
“Many aspiring business owners make two common, related mistakes: thinking too much about where to get money to start their project and thinking too little about where the business income will come from. Fixing these problems (or avoiding them in the first place) requires a simple solution: Spend as little money as possible and make as much money as you can.”
Chris Guillebeau tells two different stories of ‘Naomi’ and ‘Heather’ and illustrates two important principles related to money.
- The first Principle – A business should always focus on profit.
- The second Principle – Investing a lot or borrowing money to start a business is optional.
If you don’t know much about your business at first, you should start small. Then, you can go for a much-trial and much-error system.
Chris researched 1500 respondents. The average startup cost of the respondents was $610.60. So, it is much easier to start a microbusiness.
“Small is beautiful, and all things considered, small is often beautiful.”
However, there are some businesses that you can’t start small. You need a good amount of money to run the project. There are several ways to raise money for your business that are less riskier than a bank loan for business.
Chris holds more importance on the effect of making more money rather than borrowing startup capital. He suggests focusing on the following things –
Fix Price Based on the Benefits of your Products/Services:
As most of the purchases are emotional decisions, it is much more logical to talk about the benefits/features of the products/services.
If you fix your products/services based on their benefits, you’ll earn much more than by fixing the price based on the costs of the products/services.
Offer a Smart Ranges of Prices
Present more than one price for your offer. It will make a great difference to the bottom line and increase your income without enhancing your customer base. Apple produces very few products with a wide range of prices & options.
Get Paid Several Times from an Offer:
You can charge your customer several things by subscription, continuity program. People read newspapers and would have subscribed to have them delivered to their office or doorstop. Nowadays, Netflix and iTunes offer similar types of subscriptions like newspapers.
|100 subscribers at $20 = monthly revenue of $2,000 or yearly revenue of $24,000||1,000 subscribers at $20 = monthly revenue of $20,000 or yearly revenue of $240,000|
If you treat your customer well, contact them daily; you can make money from them multiple times.
Chris conducted an experiment offering a product at two different prices: $49 & $89. Here I include the result –
|Option 1 : $49 price||Option 2 : $89 price|
|2% Conversion Rate||1.5% Conversion Rate|
|Sells per 1,000 prospect = 20||Sells per 1,000 prospect = 15|
|Revenue per 1,000 projects = $980||Revenue per 1,000 projects = $1,335|
Result: Five fewer sales, but $355 more revenue
Part 3 – Leverage $ Next Steps
The $100 Startup Summary, Chapter 11 : Moving on Top
In this chapter, Chris talks about some tweak actions to increase income in an existing business.
Step 1 – Increase your conversion rate and increase your traffic by offering something better than the previous.
How can you do this?
- Attract more potential customer from your audiences
- Increase conversion rate through an offer, an excellent headline, or great content describing your offer.
- Increase average sales price 0 By adding different features [customer who bought this item also bought this item, most ordered, related items, free shipping} you can increase average sales price per order.
- Sell more to your existing customers who are more likely to respond to different promotions or additional offers of any kind.
Step 2 – You can take some action-based tweaking to generate more sales –
- Create a “Hall of frame” for the best customers.
- Institute an excellent up stall offer that will create a good impression and convert the traffic to customers.
- Encourage referral programs and generate more sales.
- Introduce an extensive deal offering with no guarantee.
- Introduce a more powerful guarantee
People grow Youtube, Twitter, or other social network accounts to promote other people’s work. So there is always a chance to promote your products or services.
However, staying small or going big is unique to each business based on nature. Therefore, you can focus on things that will increase your income without incurring additional costs or increasing the workload.
The $100 Startup Summary, Chapter 12 : How to Franchise Yourself
If you think about a self-made franchise, you have two options for that –
- Attract more people with the same message.
- Reach different people with new messages.
For the first option, you can go for the “hub-and-spoke” model, which can be a blog site or e-commerce site that represents a specific niche or topic.
One great way to franchise yourself is to team up with someone you know or trust. From the Ralf Hildebrandt perspective, the partnership’s primary goal is to grow beyond what you can create on your own.
Pamela Slim, an expert on the partnership, lists the following decisions you should make before formulating a joint venture.
You can outsource assistance for your business. Outsourcing allows you to do more of what you like most. However, outsourcing can be a great problem for your business. You have to spend time correcting problems that the team creates to support you.
Outsource will fit good for your business depends on the following things
- The specific business nature.
- The personality of the business owner.
If your assistant or contractor has a clear understanding of your business, you will experience fewer problems with outsourcing.
The Business Audit
Answer the following questions and solve problems if there is a one –
- Where do you make money?
- How good is your massaging?
- Are your prices what they should be?
- How are you marketing to your existing customer?
- Are you tracking, monitoring enough?
- Where are the ample missing opportunities?
An affiliate program is a program where Marchant cooperates with partners to bring more traffic and sales and reward the partner with a cut of the earnings.
Chris provides a four steps guide on an affiliate program for free on 100startup.com.
However, there is two problems associated with affiliate program –
- The merchant tend to pay very little commission
- The affiliates tend to do no more than blindly send over the referral
How to solve these problems?
Pay higher commission, so they not only blindly pass over the link but also use your product and provide honest reviews.
The $100 Startup Summary, Chapter 13 : Going Long
Everyone has the opportunity to make a career change and find a way to build a systemization into their business. Before that, deciding the role their business plays in their business is much more critical.
If you want freedom, staying small is a great idea. Instead, recruit employees and grow carefully. It’s your decision to stay small or go big. Because earning a huge amount of money is not the only reason to be a businessperson. You can have a quality life with freedom with business.
You can either go medium. It’s an excellent business model. You can partner with big-name retailers and sell your products through them. By doing this, you can make a brand value with some cool customers. However, there are also some cons there. If the retailers go down, you may go down too.
Work on Your Business
Chris suggests setting aside forty-five minutes every day and spending it to improve your business. Consider the following areas.
- Business development
- Offer development
- Fixing long-standing programs
For your business’s growth purpose, you need to pay attention to monitor your business and may follow the two-pronged strategy:
Here are the few metrics you want to track every day in your business –
- Visitors or leads per day
- Sales per day
- Average order price
- The conversion rate of sales
- Net promoter score
Later, Chris differentiates two business models in this chapter. One business model that has been built to sell after a specific time period.
This type of business requires high capital, employees and will pay you back a high amount of money. Another is the $100 startup model. This business model requires no employees, little capital, and you can do what you love.
Chris suggests going for a scalable business that is built on something that is both valuable and easily teachable because something at the interaction of teachable and valuable can be sold quickly for a high profit.
The $100 Startup Summary, Chapter 14 : But What If I Fail
The advice can be helpful for your business. Though, you don’t need anyone’s permission to pursue a dream. If you want to start your own $100 startup, stop waiting and begin.
When we do business, we are concerned about two facts. External and Internal. The external concern relates to changing the marketplace, collecting capital, or competition.
The biggest battle is against our internal concern, which is our own fear and inertia. If we are in complete control of managing it, success will knock at our door.
So, you may get the most important lesson in the whole book: Don’t waste your time living someone else’s life.
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