MBA2596 The 3 Simple Rules To Start and Grow a Business

0:00Business isn't rocket surgery, or rocket science for that matter. is actually simple. Not easy, but simple. Today, we're going to break it down into three straightforward rules that anyone can follow to start and grow a successful business. These three rules are simple to understand, but the real challenge is in the opportunity. It comes in the execution. If you're ready to cut through the noise and focus on what actually works, let's get into it.

0:31Welcome back to the$100 MBA show. I'm your host, Omar Zen, where I deliver practical business lessons to help you start, grow, and scale your business. Today's episode is about the three simple rules to start and grow a business. These are easy to remember, but they will take some effort and resilience to implement. Let's break them down. Rule number one, and it's number one for a reason. It's create a valuable product for the right audience. If you get this rule right, if you implement this correctly, half of the work is done. Your business is going to be on the right track and it's very hard to fail if you create a valuable product for the right audience.

1:12Let me get a little bit more specific. You want to create a valuable product for an audience that sees its value. It's not enough to have a great product. You need to align it with the right audience who understands and values what you offer. understands that, hey, what this person's giving me is great. If they don't get it, then it's not valuable. Let me give you an example. When I launched my software company, Webinar Ninja, over 10 years ago, we focused on solving a specific problem, making webinars easy to create and manage. Our audience, the people that we served, were small business owners and creators.

1:46They were coaches. They were authors. They needed a tool that didn't require a lot of technical background, was easy to manage by themselves. So why does this work? It's a product that only succeeds when it solves a problem or fulfills the need that people care about. The people I'm talking about here, the people that you're actually going after, the audience's perception of that value is key. It doesn't matter what you think is valuable. It matters what they think is valuable. So for example, with the software webinar Ninja, the software is not valuable to a fortune 500 company because whoever's making the decision to buy this software for the company is not going to be running the webinars.

2:24They don't really care if it's easy to use or if it's highly technical or simple. With our audience, the small business owner, the creator, they're the decision maker. They're the people that are actually going to make the decision to buy the software. And they're also the person that's going to use the software. So the ease of use matters to the decision maker. In our case, we had a great product that fit the right audience. Here's the bottom line. This is what I learned in over two decades of starting and growing businesses. Your audience is the focal point of your business. More specifically, your customer's problems are all that matter because you're in the problem solving business.

3:00Your solution to that problem is your product, is your business. So when your business starts with your audience's problem, when you start thinking about your audience's problems, then you start finding a way to come up with solutions to those problems. And now you've got a business that's rocking and rolling because that really solves a pain point for a specific group of people that sees the value of the solution. We're not just creating value for anybody. We're creating value for a specific group of people. Rule number two, market your product like it's the best thing in the world. It's very simple.

3:34If you don't market, you don't exist. Marketing, in my opinion, is the second most important thing in a business. The product itself, what you're offering is very important, like I mentioned. But right after it is letting the world know that it exists. Marketing is so powerful. And I've seen this over and over again. An inferior product will do better, will be a more powerful business in the marketplace than a superior product because it has superior marketing. I know this sounds crazy, but there's a lot of leaders in the market that don't have the best product. The product is not the best product out there.

4:09It's the best marketing for that product. So if you want your great product to succeed and you want to actually excel the growth of your business, then you need to focus on marketing your product and business. Your product needs to be marketed in a way that's making it irresistible. People should see your product and immediately want to learn more. They immediately should be thinking, how can I buy this? What's this all about? This seems interesting. Let me give an example. Recently, I bought a new camera called the Insta360 X4. And this is a 360 camera. I wasn't really familiar with the 360 cameras, but I saw a YouTube video about it.

4:46When I learned what it was and what it was capable of, I immediately thought, what is this camera? I got to learn more. So I went to the Insta360 website. I watched a couple more videos. I went on Amazon. It was available. I bought it within days because it showed me the value of this camera very quickly. The videos I watched on YouTube were sponsored videos by creators. They showed me the value of the camera, show me the shots it could take, show me the versatility of it. And as a content creator, I see the value in that. I'm like, oh, I want that. That's something that I can really use when I'm out and about and traveling.

5:18Another good example is think of Apple's marketing. When they launch a product, it's not just a product. It's an experience. They create this intrigue and excitement and a sense of urgency. Again, when we ran a webinar in Azure, our software company, we made it a no-brainer for our audience to check us out and see what we're offering. We ran ads. We did live demos. We did free trials. We did webinars. So we highlighted how we really solved the pain point for that audience. And we showed how we did it with better than competitors. We actually did side-by-side comparisons with our competitors. So how do you apply this?

5:50How do you actually put this into action? Well, you have to understand your audience's emotional triggers. What excites them? What frustrates them? How does your product answer those emotions? A lot of people don't realize that most of the reasons why we buy is because of an emotion. We're frustrated. We're angry. We're fed up. We're excited. We're yearning for attention or significance. So we look for ways, products, experiences, services to fulfill those needs, those emotions. So you need to understand what your customers are feeling so you can address those emotions with your product. This is why customer interviews are so important.

6:26As soon as you have a few customers, get on a call with them, get on a Zoom call and ask questions like, why did you buy this product? What prompted you? What were you feeling at the time? What did you feel before? What did you feel after? The second thing you want to do is you want to use social proof, urgency, and storytelling in your marketing to create a narrative, a story that connects with your audience. They need to relate to the why behind your product. This is why I'm constantly giving examples and stories from my businesses, my past, my current business right now. Marketing isn't about shouting louder.

6:58It's about resonating deeper with your audience so that when they come across you like, yes, this person gets me. This business understands what I'm going through. I want to learn more. Before we get to rule number three, let's recap real quick. Rule number one, create a valuable product for an audience that sees its value. Rule number two, we want to make sure we market our product like it's the best thing in the world. Use and understand our customers' emotions so that we can address them through our product marketing. Let's move on to rule number three, be profitable. The aim is profitability, not just revenue in your business and not just any profit.

7:35We want healthy profit. What do I mean by that specifically? I want to set a goal for you. Your goal should be to hit at least 40 % net profit margin. This allows you to pay yourself a dividend. So it's worth all this effort. This allows you to reinvest in your business. So it continues to grow. And this allows you to still have a buffer for unexpected challenges. I say unexpected, you should expect it. Challenges will happen. Now I said 40 % net profit. There's a difference between gross profit margin and net profit margin. Let me break it down really quick. Gross margin. This is your revenue minus the cost of goods sold.

8:12It shows how efficiently you can produce your product. So for example, if this notebook cost you$5 to create and you charge$10, your gross profit margin is$5. Net margin, this is the revenue minus all expenses, the cost of goods sold, marketing, salaries, everything like paying your internet bill, your office bills, whatever to run your business. This shows how much you're actually keeping as a profit. So what we're really focusing on here is the bottom line, your net margin. When we started this company, the$100 MBA back in 2013, we made profitability a top priority. So instead of spending excessively on like a flashy office, we focused on delivering value to our customers.

8:57We really wanted to make sure that we kept our costs in check to keep our margins high. A business that isn't profitable is just a hobby. Profitability gives you options. You can grow, you can pay yourself, you can build a sustainable future. You got to be profitable. And that's why it's rule number three. Revenue is vanity. Profit is sanity. So to recap real quick, to start and grow a successful business, stick to these three simple rules. Create a valuable product for the right audience. Focus on solving a real problem for people who care about the solution that really want a solution like this.

9:31Number two, market like you mean it. Okay, market your product to make it irresistible. And remember, if you don't market, you don't exist. Number three, be profitable. Aim for 40 % net profit margin to pay yourself, reinvest, grow sustainably. Pretty simple. Yes? Easy? That's where the discipline comes in. That's where you got to stick to these rules and put it into work. You got to see it happen and see results. Trust me. If you just focus on these three rules, rinse and repeat, that's it. Every time I build a business, I just focus on these three things because that's really what's most important.

10:07Thanks for tuning into the$100 MBA show. So if you want to go deeper with me, if you want to grow your business every single week, then you should sign up for our newsletter. It's easy to sign up. Just go to our website, 100mba.net. It's absolutely free. Just sign up for any of our freebies. Then you're on our mailing list. Then every week, I'm going to send you an email. And I'm going to ask you to do three things. Yes, we are all about action. It's something to think about, something to do like an exercise, and something to learn. This ensures that you are growing and building your business week after week.

10:38It's absolutely free. It's my way to kind of coach you from afar. Thank you so much for listening. If you enjoyed today's lesson, if you got value from it, don't forget to hit follow or subscribe right now on your favorite podcast app or on YouTube if you're watching on YouTube. It's the best way to support the show. I'm Omar Zinhome, and I'll see you in the next episode.