How to Build a Business That Won’t FAIL — and Gives You Financial Freedom transcript

I looked at every business book I have ever read in the last 9 years. I threw away the garbage and picked the few good books. And from those, I pulled the absolute most important things for a small business. I turned all of it into one simple map. Just eight parts. From your first idea all the way to a business that pays you while you walk in the park on a Tuesday morning. Let's start with part one. Idea validation. Imagine spending 3 months building a website.

You pay for a logo, you set up a company, you finally launch your big business idea. And then crickets. Nobody buys. You just wasted 3 months of your life. 90% of beginners blow up their business before they even start. Why? Because they get the order wrong. They think the order is idea, build, sell. That is a trap. Before you spend a single dollar or waste a single minute building something, you have to let the market decide if your idea is actually good.

You have to validate it. If you tell a friend about your idea, they will say "Wow, that's amazing. You should do it." Do not trust them. Your mom, your friends, your wife, they will all lie to you about your business idea. Not because they're bad people, but because they are polite. Here's what you do instead. You ask for the money within 48 hours. Noah Kagan calls this the 48-hour money challenge. Get three paying customers in 2 days.

That's it. In his book Million Dollar Weekend, he tells the story of his friend Boris. Boris had an idea for a healthy meal delivery service. He didn't build a website. He didn't design a logo. He sent one email to his close friends and asked, "Will you pay me 20 bucks right now to deliver healthy meals next Friday?" Five of them paid. As you can see, Boris didn't start with a logo. He validated his idea by asking for money straight away.

And here's another example on how to validate your business idea. Imagine you want to start a dog walking business. You go to a few dog owners in your neighborhood. You pitch them. And guess what? They don't want a dog walker because they love walking their own dog. That's the best part of their day. But, you keep talking and you find out something else. They need someone to watch their dog while they're on vacation.

They'll pay you 60 bucks a day for that. Three say yes on the spot. Look, you started with a dog walking business idea, but you end up with a dog sitting business instead. Same neighborhood, same dogs, completely different product. And you only found this idea works because you asked for money, not for feedback, but money straight away from the beginning. Now, here's another way to validate your idea. Do it online. Post it on social media.

Use Facebook Marketplace or eBay or whatever free selling site people use where you live. Don't create your own website yet. Don't create a detailed business plan whatsoever. Just a post and a payment link and see if there are people who really want to buy what you're selling. Get at least three real payments before you go all in with that idea. If they say, "I'll buy it later." That's It's a nice way of saying no. And now, what if no one's buying?

Let's say you've asked three people and all three said no. Most beginners take that as a sign they should quit. They pack up the idea, feel sorry for themselves, and stop. Don't do that. Because a no is not the end, it's data. Use these four questions to turn rejection into a new opportunity. First, ask them why not? Second question, who's the one person you know who would actually love this? Third question you can ask, what would make you buy this right now?

And lastly, ask how much would you pay for that instead? Finding the right price is a bit difficult when you first start. If you can get potential customers to tell you the actual amount they'd pay, that could give you a better starting point. Now, what if you ask and ask and ask and nobody wants what you're offering? That's still a win. Why? Because you didn't waste tons of time and money on the wrong idea. You found out in 3 days, not 3 years.

That's a gift. So, pick another business idea and go get three people to pay you. That's how you validate your business idea before going all in. Part two, positioning. Let's say you decided to start the business. Maybe you open a coffee shop or sell a course online. For a few months, life is good. Then you look around. There are 10 other guys doing the exact same thing you do, and they charge the exact same price. So, how do you get people to buy from you?

You drop your price a little. Then they drop theirs. So, you drop yours again. Now, you make less money on every sale. You have to work twice as hard just to end up exactly where you started. That's a price war. And in a price war, nobody wins. You just bleed slower than the next guy. Most people think there's only one way out of that fight. They think you have to find some magic place where there's no competition, an empty blue ocean all to yourself.

That is a myth. The real move is to stay in the crowded market, but refuse to play their game. You change the rules so the competition doesn't even matter anymore. Here are four simple questions you need to ask yourself. Number one, eliminate. What can you just get rid of? Most businesses keep doing stuff just because everybody else is doing it. Number two, reduce. What can you make much smaller or simpler than normal?

Especially things that aren't that important for your customers. Number three, raise. What can you make better than everybody else? And number four, create. What is something new you can offer that nobody has offered before? That's it. Four questions. First two helps to reduce your costs, and the last two create more value for the customer. Let me show you how this works in real life. Let's go back to that coffee shop.

Say it's yours. Right now, every cafe on your street is exactly the same. Decent coffee, a few cakes, comfy chairs, nice music. You are all fighting for the exact same people, and your only weapon is lowering your price. Instead, aim those four questions at one guy nobody cares about. The guy who's not there for the coffee. He's there to work. The student, the freelancer, the guy looking for a plug for his laptop. Eliminate.

Kill the massive cake display. This guy is not there for the cake, and he does not want to have small talk with the barista. He wants to grab a simple coffee and be left alone to work. So, eliminate all of it. Reduce. The big soft couches everyone fights over? He doesn't want a couch. He wants a real desk. So, shrink the lounge area. Raise. Give him the stuff he actually needs. The fastest internet in town, a power plug at every single seat, big tables, a chair that won't kill his back after 3 hours.

Create. Now, do the one thing no other cafe does. Stop making him buy a coffee every hour just to keep his seat. Charge him $10 for the whole day. Coffee included. Tell him straight, "Stay as long as you want. This is your office." Look at what you just built. A totally different business. The cafe next door is not your competition anymore. You are now competing with expensive shared office spaces that charge $300 a month.

But, you let him pay by the day. Only when he shows up. Now, look closer at what you did to your costs. You killed the fancy coffee, dumped the cakes, removed the couches. All the things that make a normal cafe expensive to run are gone. You probably think the fastest internet and the good desks cost a fortune. They don't. The most expensive part of a cafe is the skilled staff and the food that goes bad. You cut the heavy stuff, and you added the cheap stuff.

You walked away from the price war, and your business is now cheaper to run. You give the customer more, and it costs you less. Both at the same time. That is the whole game. You might be thinking, "I'm not opening a cafe." It doesn't matter. The cafe is just the simplest example I could find. So, do one thing tonight. Take a piece of paper, write down everything your competitors do. Price, speed, the free water by the door, all of it.

This is like freezing your competition and taking a photo. Now, you can finally see the game everyone else is playing. Then, go down that list. Ask the four questions. What can you eliminate, reduce, raise, create. This is how you stop being one of 10. This is how you become the only one. Part three, premium offer. If I offered you a brand new Ferrari for $10,000, you'd find the money today, even if you had to borrow it.

That's exactly how your customers should feel about your offer. You create an offer so good that people feel stupid to say no. Here are three steps to build such an offer. It's from Alex Hormozi's book, 100 Million Dollar Offers. Number one, sell the outcome, not the product. Let's say you sell a weight loss program. Look, nobody wants a 12-week program. They want to look in the mirror and like what they see. They want to fit back into the old jeans, and take off their shirt at the beach without worrying how people might judge them.

That feeling is what they're paying for. So, sell that. And one more thing here, they also have to believe you can actually get them there. That's what before and after photos are for. Real reviews or your own proof. Show them the result then prove you can deliver it. Number two, make it feel fast and easy. Here's where most beginners go wrong. They just shout bigger promises. Lose 30 lbs. Make six figures. But anyone can shout a bigger number.

It's easy and everybody's already doing it. The pros do it differently instead. They make it faster and they make it easier. Look at this. The supplement industry is twice the size of the entire gym industry. Twice. Why? Because swallowing a pill is easier and faster than dragging yourself to the gym every day. Same dream, less effort. And people happily pay more for it. So, don't just make the dream bigger, make the path to it shorter and simpler.

But, here's the thing. What if your product takes time to work? For example, in a weight loss program, people won't get results overnight. Here's how you fix that. Give them a more aggressive diet right at the beginning. Something that shows results fast. Why? Because you want them to have a big, fast emotional win so they commit to the long term. This is actually backed by science. People who get a win early on are way more likely to stick around than those who don't.

Give them that quick win in the first week and they will stay to the end. Number three, stack your offer. Don't just sell one thing. Solve every single problem standing between your customer and that final result. Back to weight loss. What are your customers problems? They don't know what to buy at the store. They don't know how to cook healthy meals. They've got no time to exercise. So, you solve all of it. A grocery list with a recorded grocery video tour.

A video where you cook 30 recipes, each one under 10 minutes. A snack guide, a meal plan for the week. A recorded video of 30 workouts under 20 minutes that they can do at home. No equipment needed. All of these in videos and PDFs. Then you stack the offer. The grocery video tour and guide, $299. The cooking masterclass, $399. The follow along workout plan, $499. That is almost $1,200 in value, and you sell the whole thing for $399.

That's an offer that's hard to say no to. They'll stop comparing you to the other guy because they see that you can fix all the problems that they had to fit back into their old jeans. Look, there's one more thing I want to highlight. As a beginner, you might be afraid to charge premium, but you have to do it. Here's why. First, when you charge premium, your customer values it more. There was research where people were given three glasses of wine.

Each glass had a price on it, $3, $6, and $18. They had to drink and rate it. Guess what happened? They rated the most expensive one as the best. The second was the second best, and the third, the cheapest, was rated as a cheap wine. But here's the thing. They didn't know that the researchers put the same wine in those three glasses. The takeaway is simple. When people see expensive things, they'll think the quality is higher.

Second, paying more makes people care. Let's say you run a therapy program. For it to work, your client has to show up and push through the uncomfortable parts. If they paid you almost nothing, the first time it gets hard, they quit. But when someone pays good money, they're invested. They do the work and they get the results. So don't be scared of the high price. Charge what it's worth. All right. Now you have a good offer with a premium price.

But nobody knows you exist. We'll solve that in part four, marketing. When I first started on YouTube, I was getting maybe 10, 20, sometimes 50 views a day. I knew the videos were good, but views stayed low for a long time. So I figured my problem was marketing. To improve this, I started to share links to my videos everywhere. I posted it on Facebook groups, LinkedIn. I used Facebook ads and YouTube ads. But nothing worked.

Then one day I sat down and looked at my analytics and I saw something that made me feel like an idiot. Almost all my views, like 90%, were coming from people who just found me on YouTube itself. And there I was, spending 90% of my time begging people on Facebook and LinkedIn to click my links. So I killed everything and put 100% of my focus into just understanding what works on YouTube. And that was when things changed.

Look, most small business owners make this exact same mistake. They spend their limited time and money on five platforms at once. A few weeks ago, a guy came to me for a one-on-one consultation. He says, "Hey, we want to launch a YouTube channel. You seem to understand the platform. Can you help us?" But as we talked, it comes out that most of his clients are already on LinkedIn, and he's actually doing pretty well there.

He just feels like he has to be on YouTube, too. Think about how crazy that is. Instead of doubling down on the one thing that is actually working, he wants to start from zero on a platform he knows nothing about. Of course, my advice to him was to forget about YouTube and just focus on LinkedIn. So, in your business, stop trying to juggle five platforms at once. Pick one. Just one channel. Find the place that works and dominate that platform.

All right, you've picked your one platform. That was the easy part. Now the hard part is who do you actually sell to? And here's the catch. Picking one customer group means dropping everyone else. I know firing your customers sounds insane, but give me a second and you'll see why it's the smartest move you can make. Imagine it's your wedding day and you need a photographer. Are you going to hire the guy who shoots every event or the pro who specializes in wedding photography?

Of course, you'll choose the wedding photographer because they understand your needs better and they know exactly when to capture the perfect shot. So, why do we try to sell to everyone? When you try to please everyone, you become the safe option nobody's excited about. Here's how you fix it. Stop chasing every customer. Find one group who are perfect for you. Let me show you a simple way to find it. Take every type of customer you serve right now.

And take a look at these three questions. Score each one from one to 10. First question, do you actually enjoy working with these people? Life's too short to spend it with clients you can't stand. Second, do they have a bleeding neck problem? Meaning, are they in so much pain they need what you sell right now? And finally, the third question, do they actually have money? Can they afford your prices without thinking twice?

Don't spend time negotiating with people who can't afford to pay you. Then add up the score for these three questions. Whichever group gets the highest score wins. Drop the rest and give that winning group 100% of your focus. Now that you have your winning group, you need to study them until it gets a little creepy. You need to understand their fears, their goals, and their late-night worries better than they do. When I started to take YouTube more seriously, I sat down and created a full profile of my ideal viewer.

Their biggest fears, motivation, goals, and all that. I finished the document and sent it to one of my teammates who was also a viewer of my channel. Then I asked him, "Hey, is this you?" A few minutes later, he replied, "This is creepy. Where did you get this info?" That is exactly the level you need to reach. You should be able to describe their problems, their pain, their secret wants to the extent they start asking, "How did you know?" So, to recap, pick one platform and dominate it.

Sell to one type of customer, someone you like, who badly needs you, and who can actually pay you well. Then, study them until it gets creepy. Part five, sales. You know, there was a time when I got hired from almost every interview I went to. And look, I'm not bragging. I definitely wasn't the smartest person in the room. My resume wasn't anything special. But I was doing one thing that nobody else did. Before every interview, I did my homework.

Not on myself, but on them. I researched about the company. I'd talked to a few people who already worked in the department I was applying to, and I was looking for one specific thing. What's broken in this job? The one that keeps the manager awake at night. Then, I would write down three to five of those problems and describe in detail how I would fix them if I got the job. At the end of the first interview, I just handed that paper over.

I asked them to pass it to the hiring manager if they consider me for the next round of interviews. And almost every time I did that, I got the job. See, every other guy was selling their college degree. I was selling the cure to their pain. Think about it like this. When you're sick, you don't ask the doctor where they went to school. You just want to make sure the doctor knows about the problem and knows how to make it stop.

That is what you have to be for your customer. A doctor, not a salesman. And honestly, this is the best sales secret I've ever learned. You're just solving a problem. The second they believe you can fix it, the sale happens. Look, I know why people get scared of selling. You think it takes years of experience, a long track record, 10 years in the game, but it doesn't. Just remember this rule. If you can explain a person's problem better than they can explain it themselves, they will automatically believe you have the solution.

People don't buy because your pitch is perfect. They buy the second they hear their own problem come out of your mouth, said clearer than they ever could themselves. But wait, just naming the pain itself is not enough. You have to prove that you can fix it. So, the next time you email a potential client, do not just tell them what is wrong. Show them you can solve it. Don't just write, "Your video thumbnails are bad.

I can fix them." Everyone writes that exact same email. Instead, fix one. Take their best video, redesign the thumbnail yourself, attach it to the email, and say, "I made you a better version of this. It's totally free. Test it out. If it beats your old one, let's talk." But here's the catch. This only works if your fix is actually good. I get hundreds of emails like this. I open the file and in 2 seconds I can see they just threw it into an AI generator and send me whatever garbage came out.

They named the problem, but they faked the solution. And because of that, they lost the sale. Now, what if you are selling a high-ticket service where you cannot just do the whole job for free? Simple. You don't give them the whole solution. You give them a free taste of it. If you are a high-priced consultant, don't fix their whole strategy. Record a 5-minute video looking at one specific problem in their business and show them exactly how to solve it.

So, remember two things in sales. One, understand their problem. Two, show that you can fix it. Part six, profit first. Most entrepreneurs run their business using this formula. Revenue minus expenses equal profit. You built your business because you wanted better pay. But with this formula, when you get your revenue, you pay all your bills first and you take whatever's left as your profit. The problem is there is almost never anything left.

So, in the book Profit First, the author says you have to flip this equation. Revenue minus profit equals expenses. When money comes in, you take your profit first. Run the business on what's left. Sounds simple, right? But doing it is not that simple cuz making money and keeping it are two different games. Some people are great at making money, but terrible at keeping it. They can't keep it because they put everything in one account.

Psychologically, as humans, we spend whatever we see. 10 grand sitting there, you'll spend all 10. So, to keep more, split it up into four accounts. Account number one is for profit. This is the most important one. The moment money comes in, take your profit first. Put it into this account. Every quarter, withdraw that money. But don't take all of it. Leave half. That'll become your rainy day fund. So, the profit account does two jobs.

It's your reward and your cushion. When you take that money, it's for you. Expensive dinner, a vacation, that thing you've been eyeing. Write in advance what you want to do with it. Post it somewhere you can see it. Why? Because when the quarter rolls around and the money's sitting there, you think you need to be more responsible. So, you put it back into the business, covering some bills. If you do that, you've taught yourself that profit is fake.

The whole point of profit is that you feel like the business is finally paying you back. Account number two, owner's pay. By the way, owner's pay and profit are two different accounts. Owner's pay is your salary for the work you do. You run the shop, you do the job, so you need a salary just like how you'd pay anyone you hired. Profit is separate. That's your reward for taking the risk to build the business. Most people never separate the two.

You should keep them apart, so you get a fair wage for the work, and you get profit for the ownership. Account number three, tax. This is the money set aside for the government. You keep it separate from the beginning so that when tax time comes, you don't have to stress out to find the money. Account number four, expenses. Whatever's left after the first three, that's what you've got to run the business. Salaries, rent, software subscriptions, all that.

And if there's not enough, that's not a reason to steal from the other three accounts. You have to lower your expenses. Now, here's a question. How much goes into each account? There's no fixed amount. If you're running a one-person business, start with 5% for profit, pay yourself 50%, save 15% for tax, run the business on the other 30%. But don't worry about the number. For profit, you can even start with 1% and build up from there.

Once your business grows, the number shifts. You take smaller pay, but bigger profit. Anyway, once the business is growing and you've got some extra for expenses, that's when you start hiring. The question is, who do you hire first? That I'll explain in part seven. Buy back your time. You start your own business because you want more freedom. You refused to work 40 hours a week for a boss. But then, you're working 80 hours a week for yourself.

And you're completely exhausted. Why? Because when the money is finally coming in, you think it's time to grow. So, you'll hire more people without knowing exactly who to hire first. At the end, you will find yourself working on the low-impact task or a high-impact task that someone else can do better than you. That is why in the early days, you should never hire to grow your business. You should hire to buy back your time.

You hire to free yourself first. You get your own hours back. And only then you think about getting bigger. Let me explain. Imagine owning a bakery and you really love baking. Then your business keeps growing. You can't handle it alone anymore. So, you hire a couple of college kids who love baking. And then the business keeps growing even more. While those college kids are baking, you're able to do the ordering, run to the store to pick up supplies, and throw up some pictures on social media.

Eventually, you're not baking at all. You have become the administrator of your business. And when you think about going to work on Monday, you're already dreading it. Why? Because you're doing everything except what you love about your business, which is baking. So, how do you fix this? Look, the hiring was not the problem. The problem was you hired in the wrong order. Let me show you the right order. And this advice comes from the book Buy Back Your Time by Dan Martell.

Number one, administration. These are the tasks that bring little money, drain you, but still important. Think of administrative work like billing, invoicing. Hire someone who truly enjoys it, so you can free up your energy to do the one thing that actually makes money. Number two, delivery. This is the core of your business. You enjoy it the most, and it's the one that brings the real money. In a bakery, it's the baking.

For a video editing agency, it's the video editing. It's emotionally hard to outsource this because you're good at it. But, if you want to free up your time, you eventually have to pass it on. Look, if it's too hard to to let go at the moment, use the 10 80 10 rule. You do the initial 10%. Then someone else does the 80%. Then you sail back in and finalize the last 10%. 80% done by someone else is 100% awesome. Number three, marketing.

When you get busy with your main thing, like baking in a bakery, it's also hard to focus on marketing at the same time. You need to hand this off to someone else so that new customers keep coming. Number four, sales. You're the best person at selling your own stuff. So, this is the one that's hard to let go. Keep closing while everything else gets handed off, and when you're ready, train someone to close like you, and let it go, too.

Number five, leadership. If you decide to grow your business even further, this is the last step. You hire leaders to manage the marketing team, the sales team, and any other team that you have. If it's a restaurant, you might have several chefs. So, you hire one head chef to lead them. When you reach this level, other great people are running your business, and it makes money without you having to be there every single day.

Now, here's the big question. How do you make sure all these people you just hired can do the job as good as you? If you want them to execute without dropping the ball and ruining your reputation, you have to build a system. That I will explain in part eight, system. The biggest mistake small business owners make is falling in love with what they sell. Your true product is not the coffee you brew or the videos you edit.

Your product is your business system. Let me repeat that because that's the secret to true freedom. You are not just selling a product. You are building a machine that delivers it. To do that, you have to shift from working in your business to working on it. So, step back, look at your business from above, and ask, "How can I get this machine to run without me being there all the time?" Pretend that you're going to franchise your business.

Pretend your business is a model that you will copy and create 5,000 more businesses like it. Not almost like it, but just like it. Perfect clones. Think of McDonald's. When you order a burger at McDonald's, either in your city or when you're traveling somewhere, you will still get the same taste. Any 18-year-old kid who doesn't even know how to cook can work there, and you still get the same burger. So, how on earth can they make the same burger as every other McDonald's worker on the planet?

Because nobody is relying on those kids. They're relying on the system. Every step is written down. The patties are the same size and shape. The pickles go in the same pattern, so they don't slide off. None of that lives in somebody's head. It all lives in a system, and the employees just follow it. That's the whole secret to a business that runs without you. And here's why this matters. If your business success depends on hiring experts, it'll be hard for you to succeed.

Experts are hard to find and expensive. But, when you build the right system, someone with the right background can do it. For example, if you need an accountant, you don't need the best accountant in town. A less experienced one can do just fine. Now, to build that system, you have to document everything that you do. Let me show you step by step. Step one, record yourself doing the task. For me, I like to use Loom, since it captures both the screen and my face.

If your business has nothing to do with laptops, for example, you own a coffee shop, you can have someone take a smartphone, record you on how to make the coffee, so that next time your staff can make the coffee exactly like you do. Explain what you're doing and why you did what you did. It will help your staff to understand you better. You might be doing this for so long that most of the things come to you just like that.

So easy. So you need to put yourself in a beginner's shoes and explain everything in detail while you do the task. Step two, turn it into a document. Once you have your recording, get it transcribed. Take your video to AI and use this prompt. Can you convert this transcript and draft a step-by-step process for me? That's it. AI will create your first draft documentation in 60 seconds, not hours. Don't worry about making it perfect or fixing what's broken.

Just document what's already working. We'll learn how to fix it in step four. Step three, create a checklist. A checklist is the high-level items that must be completed every time. The checklist is the what. The first document that you created just now is the how. So pull out the important stuff into a short checklist. The must-do items, the things that have to happen every single time. For a coffee shop, opening up might look like this.

Turn on the espresso machine. Start the coffee pot. Write the special on the board. Notice the steps are not too detailed. They simply capture the high-level steps involved. Step four, test your system. When you're about to do a task you've documented, open up that system and follow it step by step, even if you think you remember how to do it. This feels awkward at first, but it's how you catch mistakes and improve the process.

Then, give it to someone and let them do the task without your help. Wherever they get stuck, don't just yell, "Why can't they get it right?" But ask, "How do I fix the system so this never happens again?" Maybe you skipped a step. Maybe something that's obvious to you never made it onto the page. Maybe the explanation is too complicated. So, make sure you make it easier, not harder. If a system feels like extra work, it needs to be simplified.

All right, let's do a quick recap of everything we've covered in this video. Number one, idea validation. Get three customers who pay you straight away in 2 days. Don't create a logo or a website yet. Number two, positioning. Don't enter a price war. Use eliminate, reduce, raise, and create to build your own space in the market. Number three, premium offer. Create a premium offer so good that people would feel stupid to say no.

Do these three things. Sell the outcome, not the product. Make it feel fast and easy, and stack your offer. Number four, marketing. Pick one platform and dominate it. Sell to one type of customer and study them until it gets creepy to the extent that they'll ask, "How did you know?" Number five, sales. In sales, you're selling the cure to your customer's pain. See yourself as a doctor, not a salesman. Number six, profit.

Take your profit first and run the business on what's left. Split your money across four accounts: profit, owner's pay, tax, and expenses account. Number seven, buy back your time. In the early days, don't hire to grow your company. Hire to free up your time first. To do that, follow this order of hiring: administration, delivery, marketing, sales, and leadership. When you're free, then you can think about getting bigger.

Number eight. System. Your real product is not just what you sell. It's the system that delivers it consistently. Build a business that depends on systems, not specific people. That's it for this video. By the way, almost all the books mentioned have been summarized in detail on my channel. I will put the links in the description if you want to go deeper. Thanks for watching.