The first five days of The 30 Day Business have focused on exploring your top 5 business ideas. We have covered a lot of topics over the last five days, and hopefully, we have a good foundation that we can build on over the next five days.
If your experience was anything like mine, you’ve been able to think more about your top business ideas. The process of dismissing ideas that might have seemed promising but were red-herrings is liberating. The net result is you no longer have to carry these thoughts around with you. You’ve effectively cured some of your long-standing anxiety around some of your what-ifs! Great job!
If you didn’t have this experience of the last five days, that ok, you’re ahead of the game. That means you’ve been able to objectively assess your ability and opportunities before we started down this path. And that’s great!
Let’s go through the highlights of the first five days and make sure we’re all on the same page as we lead into the next five days.
Here’s an outline of what we’ll be covering in this part:
- Day 1: The filtering criteria used to Narrow to 5
- Day 2: Business Structure and Value Proposition
- Day 3: Resources Required to Operate and Build Product
- Day 4: Total Addressable Market
- Day 5: Narrow to 1
Filtering Criteria used to Narrow to 5 on Day 1
On Day 1, we did a lot of brainstorming and put in some serious work to figure out what five business ideas we were going to test. We discussed the DAFT model that guided us through idea validation steps. DAFT stood for Document, Evaluate, Focus, and Test.
We also discussed the Business Objectives that our business ideas would have. This section had us think about why we wanted to build a business in the first place. Some of the objectives we covered were Growing Revenue, Creating Free Cash Flow, adopting something more meaningful for ourselves, improving brand perception, or solving a specific problem.
Finally, we answered 27 honest questions about our idea. These questions were not soft-balls. They were heavy-hitting and required us to think objectively about our business ideas. At the end of that process, it was relatively easy to narrow to five ideas that we could move forward with into day 2.
Day 2: Business Structure and Value Proposition
On the second day, we talked more about our customers, how to know who they are, and how we will interact with them. As part of the discussion, we covered what channels we will service our customers through, and what service structure we need for our specific customers. We learned that not every product or service can or should have the same customer support structure, as customer relationships will vary greatly. An example we reviewed was the difference between a subscription service for household necessities and a mobile application for gamers. The subscription service would benefit from a more hands-on, real-time interaction with a real person where the mobile app support structure would likely only need proper online documentation. The products and target demographics were very different, so the support structure required some of our best creative thinking to get right.
The next big topic covered on Day 2 was our value proposition. We covered at length the Jobs-to-be-done theory and how our customer segmentation should not be based on traditional marketing strategies. Instead, our customer segmentation should be based on the people who are hiring products like ours to perform specific jobs for them.
On Day 2, we finally discuss revenue streams and the different ways that we can make money with our Business Ideas. This is another area where the way your make money can be very different depending on the type of business you establish.
Some of the different revenue streams we discussed were one time purchase payments, subscription payments, recurring payments for consumable goods, and time-based access fees that are not recurring.
Day 3: Resources Required to Operate your Business and Build your Products
On Day 3 we dove deeper into there business canvas and completed the worksheet by answer questions about Key Resources, Key Activities, Key Partnerships and Cost Structures.
We thoroughly covered different scenarios for each of these concepts, and walked through an example cost model that ended with the hypothetical bankruptcy of a fidget spinner company. We learned about the importance of keeping track of company costs, as well as market moves to avoid having our margins negatively impacted.
There was also a separate post written specifically about the Importance of Partnerships. In that post we covered what types of partners you’ll need to work with, and what compentncies you’ll need to posess if you are not able to fill those parts of your business with solid partnerships.
Day 4: Determine Addressable Market – Demographics, Geography, and Size
On Day 4 we did an exercise to help us think through the analysis we will need to do to find the size of our market. We walked through the thought process of figuring out how many tires are sold in the USA every year.
We learned about the importance of asking the right questions. We also learned about indirect evidence that could help us learn more about the core questions we are trying to answer. With the example of car tires, we quickly learned that knowing the total cars in the USA as well as the total number of people in the USA would help us learn more about car tires – even though those numbers were indirectly related to tire sales.
A challenge was issues to try to uncover the total number of boxes of cereal that are sold each year in the USA – without actually looking up the answer. The goal isn’t find the right answer, but flex your mind and practice thinking analytically about how the market operates and what type of buying habits exist in the world today.
Day 5: Finalize your Initial Market Research and Narrow Ideas to 1
You might not feel ready, but today is the day! You need to narrow your list of ideas to one go-forward idea. You might not be completely confident that you’re ready, but I assure you that you’re as ready as you’re ever going to be!
So, what is your idea that is going to get your full attention over the next 25 days?!