How to Launch a Business in a Weekend

0:00Rejection, what if it's a positive? One of the things I like is, how do I get a certain amount of rejections? Because guess what? Every no is getting you closer to some yes. And all these people who've had millions of dollars of success or beyond have tried a lot of things, and they've had these rejections, and they just keep going anyways. How long does it take to start a business? You might be thinking years. You've got to come up with the idea, put money behind it. But Noah Kagan says you can do it in just a few days. In fact, he wrote a book about it. Noah is the author of Million Dollar Weekend, the surprisingly simple way to launch a business in 48 hours.

0:37And he's my guest today on this special edition of Learn With Shopify. So if you want to learn how to start a successful business in one weekend, just keep watching because Noah has launched seven million dollar businesses. Insane. One is hard enough. Seven. He's the founder of AppSumo, was an early employee at Facebook, both Intel and Mint. So I think it's safe to say that Noah has a good nose for great opportunity and can't think of a better person to get sound business advice from. So Noah, thanks for being here. That was great. Thank you for having me. Just starting the business is sometimes the hardest part.

1:14And in one of your recent videos, you talk about how you go to Reddit. And then in the DIY subcategory, you look out for posts with, you know, tons of comments like, I want that. And then I personally think that's a really genius way of finding demand in unexpected places. So for our viewers that have already looked in obvious places like Google and whatnot, do you have any more hidden gems of where they can do research to spark new business ideas? Ooh, spicy. I like it. The number one way to find business opportunities is really yourself. The business opportunities I've always really pursued that are my favorite and that I've ended up working well, like AppSumo.com and even Toby with Shopify.

1:57You know, he did a snowboard business and he's like, hey, there's not a solution. Huh, maybe if I made one for myself, that's literally something you can find out and validate in a 48-hour period to become a billion-dollar business. Let's just take an example. Do you have a dog or cat? I have a dog. You're a dog, okay. And so let's say you had an idea and you're like, I'm going to build a Shopify site for dog toothbrushes. Great. It's a problem you have. your dog's breast smells, you want it to smell good, you want to get like cool canine toothbrush. What most people do is they go sign up for Shopify right away, right?

2:29They go get a domain, they go watch more videos, and they go listen to your guys' podcast, which they should. Then they grab more books, more courses. And then they're like, okay, I think I'm ready, but I probably need to talk to a few more friends, right? So that, and that point in time, it could be three, six months and they have no progress. Now, the other way, the new way that I would say, like someone like yourself, if that's your idea for an e-commerce business is you could literally text one friend or call them, get feedback on that idea and actually get them to pre-order your dog toothbrush and find out very quickly if it's a business that you actually wanna pursue much later down the road.

3:02Now there's a lot more to it, but what I'm trying to encourage people to really realize is that you don't need to spend more money, you don't need to spend more time to actually build a million dollar business. And that's definitely a huge breakthrough of how do you get going right now and not worry about so much of the how. Other ways people can think about how to come up with business ideas. I'll give you three that are my favorite. Number one, you can look at your credit card bill. So what are you spending money on? Are you spending a lot of money on dog food? Number two is look at things you're avoiding.

3:30So out here in Austin, I've been avoiding hanging up this painting at my house. It's literally on the floor. It's been about a month. Okay, honestly, it's been two months. But I just didn't want to say that. And there's a lot of other things that I've been avoiding in the house. And it's like, oh, really nice to have like a house manager person. but I don't need full time. And you start thinking about it, like that's a lot of how these best businesses happen. And a lot of the best businesses happen in a very, very short amount of time. And the last thing I would say is think about how your day goes.

3:57I like breaking it down into like morning, afternoon, and night. And then think about, okay, what happened in my day? And you start thinking, look, there's nothing. Like I was talking to James Altucher. He's like, there's nothing. And I was like, James, tell me about your morning. I played five hours of chess. Oh, How come? I want to be a grandmaster chess pro. Okay. How are you going about that? Well, I hired a coach. How's that going? He's like, I'm not getting the rating. Oh, okay. So it sounds like in your morning, you want to have better chess teaching so you can get to somewhere. And then you start realizing like a lot of the most exciting problems are ones you have yourself.

4:27And then you have to follow the process to see if it's a million dollar opportunity. And if other people then are excited to give you money for it or not. Amazing, amazing advice. I think oftentimes I hear like, think about, you know, a problem and find a solution to it. And I think you just kind of highlighting really practical ways of how you can identify problems is going to be super helpful. So I appreciate that. So once someone has their idea ready to go, then there's always the question about money. So how much money do you think people really need to start a business? You don't need any money.

5:02And I know that might surprise people, but I've started AppSumo.com, which today does$80 million a year in revenue, which is unbelievable for software deals. And I started it for$48. And I could have probably just started it for less. And so people believe they need more time. They need a better idea. They need a founder or they need some more stuff. And they really just don't. I think that's the part I've really, we really diagnosed, I think solved and cracked in Million Dollar Weekend, which was before you worried about the idea, before you even worried about the money, like what's the thing that's held everyone back from getting going?

5:34And so the two things we've identified and recognized is really about how do they get going today? Like right now, I was showing this example. My friend has had this idea to have weekly date nights. He's got kids. So he's like, I just want a babysitter every Tuesday coming over and I'll pay$400 a month. So$100 a week. They're like, okay. I always think validation, which means seeing if other people want it. Can you get three other customers in 48 hours? He's like, yeah, I have other friends who have kids that probably want date nights. I was like, all right, let's call them right now. And there's other ways of validating.

6:03So, but number one, it's how do you get going right now? And you worry less about the how. Like, how am I going to find a babysitter? Don't worry about that. Let's see if people want it. Because those are the excuses that hold you back from ever getting started. And so if you can just practice becoming a starter and getting good at starting and you keep swinging at things, eventually, yes, those things will lead you to the right destination. And the second area that I do think is just as powerful that people don't recognize is holding them back is getting better at asking. You know, asking is sales.

6:30And on my YouTube channel, I've interviewed a lot of billionaires. I worked for Zuckerberg. Moskovitz, a lot of different people who are billionaires. And almost every billionaire will say that one of the biggest things that's helped them become a billionaire is sales, becoming good at sales. And what is a sale? It's an ask.

6:48So how do we get better, you know, asking a guest to come on a show? Maybe if you're in a day job, asking for a raise. Or in an e-commerce store, it's like asking for someone to buy your product. And so how do we practice those two things so that we can start getting better at just everything that's been holding us back from even getting going to the ideas. Don't I need to buy all the product in the inventory before I sell it? I mean, the Cybertruck came out six years after people pre-ordered it, right? Your airplane flights, you pre-order those months ahead of time. Hotels, concerts, events, a lot of things are pre-ordered.

7:21And that is an indication if you're interested in something. And I found that to be the most indicative that, okay, people want it. Now let me go be resourceful. And it's easier because I have money and I've proved that people are excited about what I'm working on.

7:36Okay, so you've got your business idea. Your money is all queued up. Now we need to find customers. So where am I going to find my first customers? Oy vey. When we started talking about ideas, think about areas that you have business that you have, one, your zone of influence. So who do you have access to? So for me, I probably wouldn't start a dog business because I don't care about dogs and I don't really know a lot about dogs. I don't even know if I have a lot of friends who have dogs. I'm like that weird guy that's like, oh, it's a dog. But there's other people who have dogs. So that's potentially and ideally what I'd encourage people to start a business around.

8:08So think about what is the zone of influence you can easily access? Which groups do you have access to? And maybe what expertise or things do you have a deeper understanding of than other people? So if you're doing something like yourself, what I would encourage you to do, let's take the dog toothbrush and stick with it. I call it the dream 10. This is inspired by Chet Holmes. Do you have other dog friends? I do. Do you go to like a dog park? You guys like dog parties? Yes. I would literally just keep it super basic. Let me make a list of 10 people that I know that have dogs. Let me look at my phone.

8:40Let me look at my Instagram, Snapchat, whatever. And then I could just message these people and present them the idea that I'm thinking of before. Literally, you've done anything. You haven't spent any money. You haven't spent a lot of time. And you can find out really quickly. You said the way that you know you have a good business idea is if people are excited to give you your money. But tell me more about that. I'm so curious to hear, you know, how and when you've experienced that. And I think it's definitely difficult, especially with e-commerce, to really feel that emotion. But yeah, curious to hear a little bit more about your experience as a business owner and how people can tap into their customers' feelings as well.

9:16Totally. And this, you know, still applies whether you're doing$80 million a year or doing$80 a year, right? But it's still listening to the customer. So I'll give you different examples of listening to your customer good and bad and then the outcomes from it. So there's a guy named Jake who read Million Dollar Weekend. And he wanted to start an e-commerce business around golf trips so you can go and buy like a golf trip. I don't golf. I go to the golf range and I eat tacos and some nachos out there. But I'm not a golfer. So it's not a business I would start. But he's done golf trips and he loves it.

9:48So before he even built anything, he contacted people. He created his Dream 10 list, contacted them and said, hey guys, I'm working on a golf trip. It's going to be about$5 ,000. We're going to go to Badlands. The other two ways you can do it is how do you approach marketplaces? So let's say you're excited to do water bottles or this dog toothbrushes. Are there dog forums? Is there Etsy? Where are there communities where you can, there's people that potentially have money and raising their hand, maybe like Reddit or indie hackers, that you can post these things and see if people are excited to give you money.

10:17It's more passive. That's why I'm generally not as a fan of that. But it's definitely effective. And the last one that I would say historically people are familiar with is like buy landing pages. So you buy ads and you send people to a landing page or you send them to your Shopify store before you've even built the product to see if they're actually buying it.

10:37Kettle and Fire, they're on Shopify. A buddy of mine named Justin Mares, he had a landing page for Bone Broth. That's about 10 years ago. Bought some ads for Bone Broth because it was cheap. and people came and bought the bone broth that did not exist. And then he let them know, hey, I'm going to be making it and I'll be sending it to you. And now that business, I believe a few years ago, is generating$100 million a year in revenue.

11:00Now, the thing that's important here is that Justin's also tried a lot of other businesses that when they came to Click, no, they didn't buy anything. Or last week, I was doing Million Dollar Weekend myself to prove it works. And I attempted to start a lawn mowing business. and I knocked on my neighbor's doors, which was pretty uncomfortable. They're like, don't you run like AppSumo? Aren't you like a YouTuber? And you have this book, like, what are you doing? When do you want to mow my lawn? And I will tell you, I asked them to mow their lawns and everyone rejected me. Or they're like, if you really want me to, I will.

11:36And what you're looking for is an excitement to give you that money. Like you've identified a problem that they're, maybe you're mowing their lawn and it's half as much. Maybe you're more reliable. Maybe you show up every other week, but you do other parts of the house. And they're like, oh my God, yes. And in 24 hours, really, I was able to prove this is something people are excited. Now I can go build out a million dollars and beyond business. It sounds like you have to get real comfortable with rejection.

12:06Right? Yeah. But is rejection a bad thing or a good thing? One of the absolute values is feedback is a gift. And so if you're starting any type of e-commerce business, whether it's stands, whether it's mugs, whether it's pens, whether it's dog-related. Think about the gift that someone's telling you, like, hey, I'm not that excited about it. And you can learn why not, and then maybe you can find something they are excited about, because you're going to work hard either way. Right. So why don't you find the thing that they're like, hey, I don't really care about that. Great. Can you tell me why you don't?

12:34Okay, cool. That's interesting. And the rejection, you know, instead of such a negative, like, what if it's a positive? You know, one of the things I like is, how do I get a certain amount of rejections? Because guess what? Every no is getting you closer to some yes. And all these people who've had, you know, millions of dollars of success or beyond have tried a lot of things, and they've had these rejections, and they just keep going anyways.

13:03And that is what happens in business, is that you have to get started, and then you have to stick with it. But if you just kind of, like, keep sitting on the sidelines waiting for it to be ready, the only time is now. It really is right now. I love that. You talked a little bit about the customer-first approach versus the founder-first approach. What's the difference between the two? So it is great to solve your own problems, but there's a Venn diagram of your problems and what the world wants to pay for. And it's the same thing with everything, like content. Like I want to make videos where I sat at my desk and I, hello, let me share about, you know, what we're doing up soon today.

13:37And I put out those videos and no one watched them. Then we said, all right, well, let's try something different, which was me knocking on doors of mansions and saying, what do you do for a living? And guess what? People like watching that. And so you have to understand who is your customer, right? So for me, in all of the stuff we do, it's these, we call them the underdogs. So it's people aspiring on the business journey. They need either inspiration or they need information to be able to take action for what they want. Now, the founder first approach is when you have the idea for content or for e-commerce business, and you just start making this stuff and you totally neglect who you're making it for and seeing if that's something they're actually excited about.

14:11And I'll even give you a recent example from AppSumo. You know, AppSumo is more or less daily deals for solopreneurs. So you can get software one-time price for as an entrepreneur online. And we launch around 30 deals a month. So we go out and scour the whole internet and we get amazing prices on them. I don't know how we do it, but the team does. And we promote really, really cool products. Like even Shopify back in the day we've promoted when you guys were getting started. And so in 2022, two years ago, I had the idea, like, if we 10x the amount of deals from 600, which is what we have in our store, to over 6 ,000, we're going to 10x the business.

14:46And of course, I'm a genius. So everything I come up with works. And then you get humbled. And you're like, oh, maybe I need to listen to my own advice. And so we ran very quickly in the wrong direction. And we went to actually 13 ,000 products in our store, in our e-commerce store at AppSumo. And I ignored the team. I ignored our partners. I ignored our customers. And that's the founder first approach. Now, in retrospect, very easily, a customer first approach would have been, we have 650 products. Let's put out maybe 10 % more products. So let's go 650 to 700 and see how the customers respond.

15:26So you can, the way we call it at AppSum was test, then invest. So I just double downed. I was like, oh, this is of course going to work. But if you test something, see how your customers respond, ask them, survey them, look at some of the data, it will save you. It took us basically a year to unwind that. And that also hurt our brand and our trust with our customers. But that is the customer first approach, which is let me put out 25, 50 more deals, see how the response is. And if that works, then I can keep scaling it out versus the founder first approach is where we know we're right. And so we act upon that incorrectly.

16:00I'm chatting with Noah Kagan, founder of AppSumo and author of Million Dollar Weekend. Before that, I want to say thank you for listening. Please take a moment to subscribe to Shopify Masters and check out our backlog of episodes. There are lots of great conversations in there and tell a friend about us too. Thanks. You have had an awesome amount of experience in terms of the amount of businesses that you've tested and tried and played with. Oy vey. Oy vey. Preaching to the choir. Oy vey. I love it. How can you discern whether you're looking at a thousand dollar business or a million dollar business?

16:42What has it been for you? Has it been like an intuitive feeling? Has it been hard data? Has it been a mix of both? It's more, there's really two key things I'm looking for. Number one, how does the market look? Right? So if you go and look up gum, it's probably pretty flat. And what I like to use is Google Trends. What I'm looking for is just, and again, everything I'm telling you is no money and no time, because I want to make sure that whether if you're very, very busy and you have a day job, which most people do, I don't want you to quit your day job. I want you to find out if you have something, get it going.

17:16And then once you get to your freedom number, then quit your day job, which is what I've done twice. And both businesses went on to become multimillion dollar businesses. So you go to Google Trends and you search and you look over the five-year trend and you're looking at comparisons. So how has gum been over the past five years? How has energy drinks been over the past five years? And you're looking for markets that are at ideally flat, but really you're looking for growth. So take AppSumo as an example, AI software is an example of this, or software for AppSumo. If you look at 2010, when I started it, there was about 10 software products.

17:47And I would say half, I don't know, I'm ballparking it, but a lot of our success is because the market just got bigger and we were a part of it. And so thinking about that for yourself, I have another friend who does the opposite. He loves to choose businesses that are on the decline. So he chose newspapers and then he chose COVID masks. And I was like, just double check it. Take two seconds, double check it, and you'll see it's declining really quickly, man. And no matter how well you do, you're going to lose. so that's part one right just understand how the market potentially could be looking and also it's helpful to have comparison so let's say you have a dog business check a cat business if you have a cat business check a parakeet business check a hamster business and just by comparing you can get indications how is your specific industry now the second part that i like to do is like how hard would it be for me to make a million dollars profit for myself and so what you're looking for is that, is there any data to support how many people are interested in this and how much do they probably spend on it?

18:46Right? So that's part one. And you can do Facebook ads, you can use chat GPT, you can frankly Google it and see like how many people are drinking coffee. How many people drink coffee? A lot. And then how much do people spend on coffee? A good amount. Again, what I'm looking for is that, is there at least a million dollar opportunity? Sure. Because you're going to work hard either way. So why not you find the one that at least has a million dollars or beyond of people spending money in it that you can get for yourself. And the last part of the sequence to make sure you're working on at least a million dollar opportunity, if not beyond is a one minute business model.

19:17So what that specifically means is that if I wanted to make a million dollars, how many do I have to sell? So you take the price that you sell it for your revenue minus the cost of selling it plus shipping for doing e-commerce and that's a profit. You divide that by a million and you see very quickly like, holy crap. Like I started a business called Sumo Jerky, doing this live in 24 hours. And I found out very quickly that selling one-off jerky packets was going to take me forever to make money. But if I sold subscriptions, like three months, six months, 12 months subscriptions, I could get the money up front.

19:50And then I could sell to maybe offices. I could sell to maybe people who have bigger budgets. And so I was able to generate$1 ,000 profit in 24 hours. And what you're looking for is just trying to get an understanding of how hard it will be for you. And then you could change the revenue dials of maybe subscriptions, maybe it's complimentary products, maybe it's my pricing. It's the same thing Jake did on his golf trips. He was pricing things incorrectly, like he was going to pay for airfare. And he's like, huh, if I do the one minute business model, which I break out in the book, take out airfare, holy crap, my margins get up.

20:20I think he only needed a few hundred people to make a million dollars for himself.

20:29okay so i feel like we have a really good kind of feel for laying the groundwork of starting a business but now i'm curious to know a little bit more about scaling so let's say that you've set up your shopify site or your custom site in your case you've made a few sales how do you know that it's working? How do you know that those sales are validating your business idea? So I'm going to focus the answer more on the scale because I do think there's going to be a lot of people in the audience who are like, dude, I'm already making money, right? Like thousand a month, 10 ,000 a month, 100 ,000 a month.