WEBVTT 1 00:00:00.000 --> 00:00:02.120 You either have direct personal experience 2 00:00:02.120 --> 00:00:03.560 with the problem that you're trying to solve, 3 00:00:03.560 --> 00:00:05.480 which is if you're new to this, 4 00:00:05.480 --> 00:00:07.240 would be one of my strongest recommendations 5 00:00:07.240 --> 00:00:08.680 because you probably aren't gonna be able 6 00:00:08.680 --> 00:00:09.760 to like guess what people want, 7 00:00:09.760 --> 00:00:12.680 but if you were that person, you know exactly what you want. 8 00:00:12.680 --> 00:00:17.280 Welcome to the game where we talk about how to sell more stuff 9 00:00:17.280 --> 00:00:18.600 to more people in more ways 10 00:00:18.600 --> 00:00:20.280 and build businesses worth owning. 11 00:00:20.280 --> 00:00:21.680 I'm trying to build a billion dollar thing 12 00:00:21.680 --> 00:00:22.920 with acquisition.com. 13 00:00:22.920 --> 00:00:24.600 I always wish pesos, musk and buffet 14 00:00:24.600 --> 00:00:25.840 had documented their journey, 15 00:00:25.840 --> 00:00:27.080 so I'm doing it for the rest of us. 16 00:00:27.080 --> 00:00:28.160 Please share and enjoy. 17 00:00:30.040 --> 00:00:32.840 Last week I gave a guest lecture at University of Texas 18 00:00:32.840 --> 00:00:34.440 on a class and entrepreneurship, 19 00:00:34.440 --> 00:00:37.560 and the common question that I got in this aspiring group 20 00:00:37.560 --> 00:00:41.080 was what do I sell and how do I make it profitable? 21 00:00:41.160 --> 00:00:43.400 And so what I'm gonna do is explain to you 22 00:00:43.400 --> 00:00:47.240 one, how I pick a first product or a new product line 23 00:00:47.240 --> 00:00:49.480 that I wanna start with in a company or business, 24 00:00:49.480 --> 00:00:51.920 and then what I call the delivery cube 25 00:00:51.920 --> 00:00:54.440 of how I scale it and make it profitable 26 00:00:54.440 --> 00:00:56.840 to do this over and over and over again. 27 00:00:56.840 --> 00:00:58.400 The first thing that I wanna start with 28 00:00:58.400 --> 00:01:01.120 is the only seven things that you can sell, 29 00:01:01.120 --> 00:01:03.040 and there's digital and physical formats 30 00:01:03.040 --> 00:01:04.000 of each of these things, 31 00:01:04.000 --> 00:01:05.880 which actually give you 14 different things 32 00:01:05.880 --> 00:01:09.080 you can possibly sell as an entrepreneur in general. 33 00:01:09.080 --> 00:01:11.400 Now, everything else that I have possibly thought of 34 00:01:11.400 --> 00:01:12.600 fits within these buckets, 35 00:01:12.600 --> 00:01:14.720 so there are unlimited things to sell, 36 00:01:14.720 --> 00:01:17.560 these are just how I bucket them mentally personally. 37 00:01:17.560 --> 00:01:19.640 Number one is you can sell products, 38 00:01:19.640 --> 00:01:20.920 and for each of these six things, 39 00:01:20.920 --> 00:01:23.520 you have physical and digital versions of them. 40 00:01:23.520 --> 00:01:25.640 So for example, with products, 41 00:01:25.640 --> 00:01:27.320 you could sell a physical product, 42 00:01:27.320 --> 00:01:29.800 which would be like, I sell water bottles, right? 43 00:01:29.800 --> 00:01:31.480 I have a physical product that I sell. 44 00:01:31.480 --> 00:01:34.680 A digital product would be something like APDF, 45 00:01:34.680 --> 00:01:37.400 that is a digital product, category one. 46 00:01:38.280 --> 00:01:40.160 The second category is services. 47 00:01:40.160 --> 00:01:42.440 So this is stuff you do for other people. 48 00:01:42.440 --> 00:01:45.560 In the physical realm, a service would be a massage, 49 00:01:45.560 --> 00:01:48.000 mowing someone's lawn, fixing someone's car. 50 00:01:48.000 --> 00:01:49.120 It's usually solving a problem 51 00:01:49.120 --> 00:01:51.360 for another person taking their trash out, et cetera. 52 00:01:51.360 --> 00:01:53.960 On the digital side, oftentimes that service 53 00:01:53.960 --> 00:01:55.880 is something that happens in the digital space. 54 00:01:55.880 --> 00:01:59.800 So if you are an ad agency and you make ads, 55 00:01:59.800 --> 00:02:01.480 the ad itself that you're making is a service, 56 00:02:01.480 --> 00:02:03.360 also buying media is a service. 57 00:02:03.360 --> 00:02:05.000 Plenty of those things are services 58 00:02:05.000 --> 00:02:06.920 that exist in the digital realm. 59 00:02:06.920 --> 00:02:08.280 Making an app, building software, 60 00:02:08.280 --> 00:02:09.400 like if you have a service shop, 61 00:02:09.400 --> 00:02:11.800 all of those things would be digital services. 62 00:02:11.800 --> 00:02:14.360 So category three, you have access. 63 00:02:14.360 --> 00:02:16.120 You have physical access and digital access. 64 00:02:16.120 --> 00:02:18.960 Physical access is like, you lease a building. 65 00:02:18.960 --> 00:02:20.840 You gain access to the building. 66 00:02:20.840 --> 00:02:22.600 Digital access is you gain access 67 00:02:22.600 --> 00:02:25.320 to a library of digital content like Netflix. 68 00:02:25.320 --> 00:02:28.200 On either that, category four is attention. 69 00:02:28.200 --> 00:02:31.800 So you can sell or buy physical attention. 70 00:02:31.800 --> 00:02:33.800 That could be like a billboard, right? 71 00:02:33.800 --> 00:02:36.600 Like cars physically drive past it and see it. 72 00:02:36.600 --> 00:02:38.360 And so you can monetize that. 73 00:02:38.360 --> 00:02:41.400 To the same degree, Facebook and Google 74 00:02:41.400 --> 00:02:43.760 have digital attention in the digital space 75 00:02:43.760 --> 00:02:47.120 and they sell the eyeballs and the attention of that audience. 76 00:02:47.120 --> 00:02:50.880 category five, like the hurricane, is risk. 77 00:02:50.880 --> 00:02:55.280 So you can buy and sell physical risk and digital risk. 78 00:02:55.280 --> 00:02:59.520 So if you sell physical risk, it's selling insurance, right? 79 00:02:59.520 --> 00:03:01.360 So you can ensure a building, 80 00:03:01.360 --> 00:03:03.640 but you can also ensure against in the digital format 81 00:03:03.640 --> 00:03:05.080 a cyber threat, right? 82 00:03:05.080 --> 00:03:07.520 Both of those are types of insurance that you can buy, 83 00:03:07.520 --> 00:03:09.160 which are really risk. 84 00:03:09.160 --> 00:03:12.480 The next thing you can buy or sell is money itself. 85 00:03:12.480 --> 00:03:14.800 So that is, so the entire banking industry 86 00:03:14.800 --> 00:03:17.160 is predicated on buying and selling money 87 00:03:17.160 --> 00:03:20.640 and the rate they charge is the interest itself. 88 00:03:20.640 --> 00:03:22.600 And so you can have physical money, right? 89 00:03:22.600 --> 00:03:25.240 Like the actual US dollars, you also have digital money, 90 00:03:25.240 --> 00:03:26.560 which I'm not going to get into crypto, 91 00:03:26.560 --> 00:03:28.600 but that is a form of digital money. 92 00:03:28.600 --> 00:03:31.360 category seven is an endorsement or brand. 93 00:03:31.360 --> 00:03:33.560 So for example, in the physical world, 94 00:03:33.560 --> 00:03:36.400 I say, hey, you can use my logo on your shirt 95 00:03:36.400 --> 00:03:38.480 and you give me a percentage of all your sales 96 00:03:38.480 --> 00:03:40.440 and you make money, right? 97 00:03:40.440 --> 00:03:43.720 In the digital world, if you endorse something 98 00:03:43.720 --> 00:03:45.840 or someone uses your brand or they can, 99 00:03:45.840 --> 00:03:48.360 like when they sell a check mark on Instagram 100 00:03:48.360 --> 00:03:51.200 or if Elon sells a check mark on Twitter, 101 00:03:51.200 --> 00:03:52.600 that is selling an endorsement, 102 00:03:52.600 --> 00:03:56.040 it's selling a brand, it's selling some sort of status 103 00:03:56.040 --> 00:03:59.680 that gets transferred and a fee is paid as a result of that. 104 00:03:59.680 --> 00:04:02.440 And so these are the seven categories that I think through, 105 00:04:02.440 --> 00:04:06.000 both physical and digital that you can sell in general. 106 00:04:06.000 --> 00:04:08.880 And I have yet to think of an example of something 107 00:04:08.880 --> 00:04:10.000 that is not that. 108 00:04:10.000 --> 00:04:11.000 So I had somebody the other day be like, 109 00:04:11.000 --> 00:04:12.160 what about a rock concert? 110 00:04:12.160 --> 00:04:14.920 That is access to an experience, right? 111 00:04:14.920 --> 00:04:16.000 And so as you think through it, 112 00:04:16.000 --> 00:04:17.200 rather than trying to disprove it, 113 00:04:17.200 --> 00:04:19.440 trying to think does it actually fit in one of these buckets 114 00:04:19.440 --> 00:04:20.800 and it'll help you think through 115 00:04:20.800 --> 00:04:22.960 how many different things you can possibly sell. 116 00:04:22.960 --> 00:04:24.960 So now that you have seven physical 117 00:04:24.960 --> 00:04:28.040 and seven digital versions of categories of stuff 118 00:04:28.040 --> 00:04:29.720 that you can sell, what I was talking about 119 00:04:29.720 --> 00:04:32.160 with this entrepreneurship group is that they had $100 120 00:04:32.200 --> 00:04:33.280 to start their business. 121 00:04:33.280 --> 00:04:35.160 Now that would probably preclude you 122 00:04:35.160 --> 00:04:36.920 from most physical products, 123 00:04:36.920 --> 00:04:40.320 probably most kind of digital, like software type stuff. 124 00:04:40.320 --> 00:04:43.960 And so most of the time you're going to start likely 125 00:04:43.960 --> 00:04:47.400 with some sort of selling your time, 126 00:04:47.400 --> 00:04:50.600 which is often services, if you're starting out, 127 00:04:50.600 --> 00:04:52.120 if you're in a business and you have capital, 128 00:04:52.120 --> 00:04:54.920 then obviously the rest of these things open up. 129 00:04:54.920 --> 00:04:57.880 Like you can't sell money unless you have money, right? 130 00:04:57.880 --> 00:05:00.640 You can't ensure risk unless you have enough capital 131 00:05:00.640 --> 00:05:02.400 to show that you can cover the cost 132 00:05:02.400 --> 00:05:04.040 of the thing that you're ensuring, right? 133 00:05:04.040 --> 00:05:05.200 These should be comments and things, 134 00:05:05.200 --> 00:05:09.120 but I like to include them for the sake of completeness. 135 00:05:09.120 --> 00:05:11.400 Also because if you're an established business owner 136 00:05:11.400 --> 00:05:13.800 and you sell physical products or even services, 137 00:05:13.800 --> 00:05:15.880 you can sell the risk associated with it, 138 00:05:15.880 --> 00:05:17.760 which is like ensuring the product. 139 00:05:17.760 --> 00:05:19.720 So some people give guarantees, 140 00:05:19.720 --> 00:05:21.560 but you can actually get people to pay for a guarantee, 141 00:05:21.560 --> 00:05:23.000 which is insurance. 142 00:05:23.000 --> 00:05:24.480 That's what a paid guarantee is. 143 00:05:24.480 --> 00:05:26.560 Is someone pays just like AppleCare? 144 00:05:26.560 --> 00:05:28.200 It's just paid for insurance. 145 00:05:28.200 --> 00:05:29.440 It's a paid for guarantee. 146 00:05:29.440 --> 00:05:30.960 So I like thinking through these 147 00:05:30.960 --> 00:05:32.920 because it gives you unlimited variety 148 00:05:32.920 --> 00:05:35.760 so that you can see how diverse the things 149 00:05:35.760 --> 00:05:36.760 you can sell really are. 150 00:05:36.760 --> 00:05:39.240 Now, in terms of picking which one to sell, 151 00:05:39.240 --> 00:05:40.920 it's mostly gonna come down to two things. 152 00:05:40.920 --> 00:05:42.640 One is the resources you have 153 00:05:42.640 --> 00:05:45.760 and your skills value experience, all right? 154 00:05:45.760 --> 00:05:47.080 And so at the end of the day, 155 00:05:47.080 --> 00:05:48.920 this is my massive simplification 156 00:05:48.920 --> 00:05:51.040 for figuring out what you should sell. 157 00:05:51.040 --> 00:05:52.440 Figure out the person you could provide 158 00:05:52.440 --> 00:05:54.640 the absolute most value to. 159 00:05:54.640 --> 00:05:56.640 And one of the key points here is that 160 00:05:56.640 --> 00:05:59.320 it can be a combination of those categories. 161 00:05:59.320 --> 00:06:03.080 So if someone sells a rock concert, for example, 162 00:06:03.080 --> 00:06:04.720 you're selling access to an experience, 163 00:06:04.720 --> 00:06:07.360 but you might also sell drinks and t-shirts while you're there. 164 00:06:07.360 --> 00:06:08.360 So you have physical products 165 00:06:08.360 --> 00:06:10.040 and a physical experience that are there. 166 00:06:10.040 --> 00:06:10.840 Then you might record it 167 00:06:10.840 --> 00:06:12.480 and then also sell the digital versions of that. 168 00:06:12.480 --> 00:06:13.600 Do you know what I'm going with here? 169 00:06:13.600 --> 00:06:14.960 But if you think through this way, 170 00:06:14.960 --> 00:06:16.360 it can help you organize your thoughts 171 00:06:16.360 --> 00:06:19.400 the way a more experienced business owner might. 172 00:06:19.400 --> 00:06:20.840 But it's gonna start with, 173 00:06:20.840 --> 00:06:22.600 who can I provide the most value to? 174 00:06:22.600 --> 00:06:25.960 And how much is it gonna cost me to provide that value? 175 00:06:25.960 --> 00:06:29.080 Versus how much money I currently have. 176 00:06:29.120 --> 00:06:30.520 And so if you cross-reference that, 177 00:06:30.520 --> 00:06:32.840 which is, here's the person I provide the most value to, 178 00:06:32.840 --> 00:06:36.000 for the least amount of money to me, 179 00:06:36.000 --> 00:06:37.440 that's where your sweet spot is 180 00:06:37.440 --> 00:06:39.080 as the first or next thing 181 00:06:39.080 --> 00:06:41.080 that I would probably package in sell. 182 00:06:41.080 --> 00:06:43.760 Why combinator looks for one very important, 183 00:06:43.760 --> 00:06:45.080 they look for five characteristics, 184 00:06:45.080 --> 00:06:46.320 but I'm gonna hit on one that's related 185 00:06:46.320 --> 00:06:48.560 to the product that founders choose. 186 00:06:48.560 --> 00:06:49.560 One of the things they look for 187 00:06:49.560 --> 00:06:51.960 is past experience in the industry. 188 00:06:51.960 --> 00:06:53.280 Now to be clear, it doesn't mean 189 00:06:53.280 --> 00:06:54.360 because if you're a first time entrepreneur, 190 00:06:54.360 --> 00:06:55.200 then you're like, well, 191 00:06:55.200 --> 00:06:56.440 I don't have any other experience, 192 00:06:56.440 --> 00:06:57.720 but you actually do. 193 00:06:57.720 --> 00:06:59.320 And let me hear me out. 194 00:06:59.320 --> 00:07:01.880 So your parents did something. 195 00:07:01.880 --> 00:07:03.000 And if you don't have parents, 196 00:07:03.000 --> 00:07:05.120 the people who raised you did something. 197 00:07:05.120 --> 00:07:06.240 And if no one raised you, 198 00:07:06.240 --> 00:07:08.200 people you knew did something. 199 00:07:08.200 --> 00:07:09.600 All right, and you were around them. 200 00:07:09.600 --> 00:07:11.960 So like, for example, my mom is a doctor. 201 00:07:11.960 --> 00:07:13.160 She's an eye surgeon, right? 202 00:07:13.160 --> 00:07:14.520 She did glaucoma and cataracts. 203 00:07:14.520 --> 00:07:16.640 So I know a lot of stuff about eyes. 204 00:07:16.640 --> 00:07:18.080 So if I wanted to get into a space, 205 00:07:18.080 --> 00:07:19.360 that would be a category of stuff 206 00:07:19.360 --> 00:07:20.880 that I actually know a lot more about 207 00:07:20.880 --> 00:07:21.960 than you might expect. 208 00:07:21.960 --> 00:07:23.160 If your dad was a mechanic, 209 00:07:23.160 --> 00:07:24.680 you probably know what a carburetor is. 210 00:07:24.680 --> 00:07:25.720 I have no idea what it is. 211 00:07:25.720 --> 00:07:26.800 I've heard the word before, 212 00:07:26.800 --> 00:07:28.880 but like, it's something, right? 213 00:07:28.880 --> 00:07:30.680 But somebody who was raised in that household 214 00:07:30.680 --> 00:07:33.080 would have a huge leg up on other people. 215 00:07:33.080 --> 00:07:35.320 And that's category one of things 216 00:07:35.320 --> 00:07:36.840 that you already have experience with. 217 00:07:36.840 --> 00:07:38.200 The other category is oftentimes 218 00:07:38.200 --> 00:07:39.480 you've had little odd jobs. 219 00:07:39.480 --> 00:07:40.640 Like when I was in high school, 220 00:07:40.640 --> 00:07:41.840 I was a blender-tenor, 221 00:07:41.840 --> 00:07:44.880 and then I did catering at an orthodox Jewish company. 222 00:07:44.880 --> 00:07:46.000 So I had like, 223 00:07:46.000 --> 00:07:47.800 experience with an interesting niche or culture 224 00:07:47.800 --> 00:07:50.080 and also catering for weddings and bar mitzvahs. 225 00:07:50.080 --> 00:07:52.440 And so I had very diverse experiences. 226 00:07:52.520 --> 00:07:53.520 And so the thing is, 227 00:07:53.520 --> 00:07:56.040 is you can have the most direct version of that. 228 00:07:56.040 --> 00:07:57.960 You can also take a step adjacent to that. 229 00:07:57.960 --> 00:08:00.200 So I could have a fur coat experience, 230 00:08:00.200 --> 00:08:01.320 but I worked in the warehouse. 231 00:08:01.320 --> 00:08:03.160 So it might just be warehousing in general. 232 00:08:03.160 --> 00:08:05.840 I have at least the feel for how that might work. 233 00:08:05.840 --> 00:08:07.400 If I, since I did catering, 234 00:08:07.400 --> 00:08:10.680 I also have an experience for what kind of hospitality 235 00:08:10.680 --> 00:08:11.880 and serving looked like. 236 00:08:11.880 --> 00:08:13.600 So I might think, okay, well, 237 00:08:13.600 --> 00:08:15.040 I know what it's like to be a server 238 00:08:15.040 --> 00:08:16.360 in one of those situations. 239 00:08:16.360 --> 00:08:18.640 I also know what it's like to be the person who's at the table 240 00:08:18.640 --> 00:08:20.000 because I've been on both sides. 241 00:08:20.000 --> 00:08:21.720 So that's something that I have more context to you. 242 00:08:21.720 --> 00:08:22.920 I've also been in the kitchen there. 243 00:08:22.920 --> 00:08:24.560 So I saw some of the inefficiencies there 244 00:08:24.560 --> 00:08:25.760 that I could probably solve. 245 00:08:25.760 --> 00:08:27.720 And so one of the things that they want 246 00:08:27.720 --> 00:08:30.080 is that you either have direct personal experience 247 00:08:30.080 --> 00:08:31.560 with the problem that you're trying to solve, 248 00:08:31.560 --> 00:08:33.760 which is if you're new to this, 249 00:08:33.760 --> 00:08:35.520 would be one of my strongest recommendations 250 00:08:35.520 --> 00:08:36.920 because you probably aren't going to be able 251 00:08:36.920 --> 00:08:38.000 to like guess what people want, 252 00:08:38.000 --> 00:08:39.040 but if you were that person, 253 00:08:39.040 --> 00:08:40.680 you know exactly what you want. 254 00:08:43.480 --> 00:08:44.520 Most of the nation real quick, 255 00:08:44.520 --> 00:08:47.560 if you are a business owner that has a big old business 256 00:08:47.560 --> 00:08:49.680 and wants to get to a much bigger business, 257 00:08:49.680 --> 00:08:53.120 going to $50 million plus we would love to talk to you. 258 00:08:53.120 --> 00:08:54.320 And if you like that, 259 00:08:54.320 --> 00:08:55.320 we'd like to hear more about it. 260 00:08:55.320 --> 00:08:58.000 Go to acquisition.com and you can plan anywhere on the page 261 00:08:58.000 --> 00:09:00.040 and talk to one of our team and see 262 00:09:00.040 --> 00:09:01.160 if we can help you get there. 263 00:09:03.440 --> 00:09:05.600 The other version is that you at least were one step removed 264 00:09:05.600 --> 00:09:07.320 from it like a parent, a friend, 265 00:09:07.320 --> 00:09:08.840 you worked in the job, et cetera. 266 00:09:08.840 --> 00:09:10.800 And then you can transfer the experience 267 00:09:10.800 --> 00:09:12.080 that you had there to the new thing 268 00:09:12.080 --> 00:09:13.960 because there's a lot of ignorance debt 269 00:09:13.960 --> 00:09:15.640 of stuff that you don't know about. 270 00:09:15.640 --> 00:09:17.840 If you go into a truly net new industry, 271 00:09:17.840 --> 00:09:19.440 if you went from catering to trying to figure out 272 00:09:19.440 --> 00:09:21.560 payment processing without ever having done it 273 00:09:21.560 --> 00:09:22.720 because you watched a YouTube video, 274 00:09:22.720 --> 00:09:24.120 you're gonna have a steep learning curve. 275 00:09:24.120 --> 00:09:26.360 But if your brother was in payment processing 276 00:09:26.360 --> 00:09:28.880 for like five years or your roommate was, 277 00:09:28.880 --> 00:09:30.560 you probably know a lot of stuff 278 00:09:30.560 --> 00:09:33.160 just from osmosis of being around it. 279 00:09:33.160 --> 00:09:35.440 And so that's also one of the lenses that I look at 280 00:09:35.440 --> 00:09:36.280 in terms of okay, 281 00:09:36.280 --> 00:09:38.560 we have these seven things digital and physical. 282 00:09:38.560 --> 00:09:39.480 Is there any one of these 283 00:09:39.480 --> 00:09:41.320 that I already have a little bit more experience with? 284 00:09:41.320 --> 00:09:42.680 And then of those things, 285 00:09:42.680 --> 00:09:45.160 which problem is the biggest that I think I can solve 286 00:09:45.160 --> 00:09:47.160 given the resources that I have access to? 287 00:09:47.160 --> 00:09:49.040 And before I get into the delivery cube, 288 00:09:49.040 --> 00:09:50.960 what I want you to think with is what I call 289 00:09:50.960 --> 00:09:53.800 the easy to sell hard to fulfill continuum, okay? 290 00:09:53.800 --> 00:09:54.920 So just think on either side, 291 00:09:54.920 --> 00:09:57.160 you've got easy to sell hard to fulfill 292 00:09:57.160 --> 00:10:00.520 and hard to sell easy to fulfill on either side of this. 293 00:10:00.520 --> 00:10:02.040 When we run through this delivery cube, 294 00:10:02.040 --> 00:10:04.000 you can probably think in your head, okay, 295 00:10:04.000 --> 00:10:05.600 one of these, the more extreme version 296 00:10:05.600 --> 00:10:08.160 will be really easy to sell really hard to deliver. 297 00:10:08.160 --> 00:10:09.440 On the flip side, man, 298 00:10:09.440 --> 00:10:10.760 that's not delivering very much, 299 00:10:10.760 --> 00:10:12.840 which makes it significantly harder to sell. 300 00:10:12.840 --> 00:10:14.440 And so based on your ability, 301 00:10:14.440 --> 00:10:16.000 you'll find a sweet spot. 302 00:10:16.000 --> 00:10:17.800 You're like, I might not be that good at sales. 303 00:10:17.840 --> 00:10:20.080 Okay, so you might have to do way heavier on delivery. 304 00:10:20.080 --> 00:10:20.920 And that's okay, 305 00:10:20.920 --> 00:10:22.600 because you're just getting started and you're gonna learn. 306 00:10:22.600 --> 00:10:24.480 And over time, you'll find the sweet spot 307 00:10:24.480 --> 00:10:26.320 where you can sell it really well 308 00:10:26.320 --> 00:10:28.560 and it's not overwhelming to deliver. 309 00:10:28.560 --> 00:10:30.880 And that will ultimately drive the profitability 310 00:10:30.880 --> 00:10:33.600 and scalability of whatever it is you wanna sell. 311 00:10:33.600 --> 00:10:35.120 Once you've established that, 312 00:10:35.120 --> 00:10:37.960 what I like to run the thing that I've picked through 313 00:10:37.960 --> 00:10:41.160 is how can I enhance or make it more or less valuable 314 00:10:41.160 --> 00:10:43.600 or more or less profitable for me as a business owner? 315 00:10:43.600 --> 00:10:46.160 And so I run the thing that I picked 316 00:10:46.160 --> 00:10:48.000 through what I call the delivery cube. 317 00:10:48.000 --> 00:10:50.600 The delivery cube has six pieces to it. 318 00:10:50.600 --> 00:10:51.960 And they work like this. 319 00:10:51.960 --> 00:10:54.040 And so each of these is a mental framework 320 00:10:54.040 --> 00:10:56.480 that you can apply to whatever it is that you sell. 321 00:10:56.480 --> 00:10:59.720 Number one is, can I deliver this thing one to one? 322 00:10:59.720 --> 00:11:01.560 Can I deliver it in a small group? 323 00:11:01.560 --> 00:11:03.000 Can I deliver it one to many? 324 00:11:03.000 --> 00:11:05.080 Each of these have different value propositions 325 00:11:05.080 --> 00:11:06.520 that are associated with them. 326 00:11:06.520 --> 00:11:10.600 In my experience, I have sold products and services 327 00:11:10.600 --> 00:11:12.360 in each of these capacities. 328 00:11:12.360 --> 00:11:15.440 So if you sold semi-private group stuff, 329 00:11:15.440 --> 00:11:17.680 it's a small group of five people doing something 330 00:11:17.680 --> 00:11:19.680 that's different than doing a webinar 331 00:11:19.680 --> 00:11:21.480 to a thousand people at once, 332 00:11:21.480 --> 00:11:23.720 versus having a call review system 333 00:11:23.720 --> 00:11:24.760 where you review someone's calls 334 00:11:24.760 --> 00:11:26.360 to give them feedback one-on-one. 335 00:11:26.360 --> 00:11:27.800 These are all different ways 336 00:11:27.800 --> 00:11:30.640 of delivering the same fundamental service, 337 00:11:30.640 --> 00:11:32.880 but with wildly different value propositions. 338 00:11:32.880 --> 00:11:34.160 That's why it's the delivery cubes. 339 00:11:34.160 --> 00:11:35.800 When I think about how much I'm in charge, 340 00:11:35.800 --> 00:11:37.080 I think through each of these things 341 00:11:37.080 --> 00:11:40.160 that give me more scale on the thing I'm selling. 342 00:11:40.160 --> 00:11:42.400 The second frame of the delivery cube is, 343 00:11:42.400 --> 00:11:46.520 do it yourself, DIY, DWI, which is done with you, 344 00:11:46.520 --> 00:11:48.200 as in you're holding their hand through the process 345 00:11:48.200 --> 00:11:49.680 of whatever it is you're doing, 346 00:11:49.680 --> 00:11:52.240 or done for you where you do all of the work yourself 347 00:11:52.240 --> 00:11:54.640 and you sell them a final product or a final outcome. 348 00:11:54.640 --> 00:11:56.800 Each of these give you different levels of scale. 349 00:11:56.800 --> 00:11:59.040 Do it yourself, you can sell it unlimited out. 350 00:11:59.040 --> 00:12:00.960 Typically, the value is smaller. 351 00:12:00.960 --> 00:12:03.560 Done with you, you have in between 352 00:12:03.560 --> 00:12:05.720 the two extremes of do it yourself and done for you. 353 00:12:05.720 --> 00:12:08.200 Done for you is the most expensive typically. 354 00:12:08.200 --> 00:12:09.560 Sometimes the easiest to sell, 355 00:12:09.560 --> 00:12:11.600 but one of the hardest things to deliver on. 356 00:12:11.640 --> 00:12:13.000 Because you take all of the onus 357 00:12:13.000 --> 00:12:14.720 and all the responsibility for the outcome. 358 00:12:14.720 --> 00:12:17.040 And so these are C-saws that you're thinking through 359 00:12:17.040 --> 00:12:17.880 that I'm thinking through 360 00:12:17.880 --> 00:12:19.720 when I'm making a new product line, new service, et cetera. 361 00:12:19.720 --> 00:12:22.640 The third frame is what level of support am I going to do? 362 00:12:22.640 --> 00:12:24.680 And specifically on what medium. 363 00:12:24.680 --> 00:12:26.040 And so what that means is, 364 00:12:26.040 --> 00:12:28.440 am I going to offer support via chat? 365 00:12:28.440 --> 00:12:29.880 Am I going to offer support via email? 366 00:12:29.880 --> 00:12:32.040 Am I going to offer support via phone call? 367 00:12:32.040 --> 00:12:33.400 Is it going to be Zoom call? 368 00:12:33.400 --> 00:12:34.720 These are all different ways 369 00:12:34.720 --> 00:12:37.760 that I can support whatever the thing is that I'm selling. 370 00:12:37.760 --> 00:12:39.960 Obviously, if I do email support 371 00:12:39.960 --> 00:12:41.840 and that's the only way someone can contact me 372 00:12:41.840 --> 00:12:44.160 is through by submitting something on my site, 373 00:12:44.160 --> 00:12:46.080 that's going to be significantly more scalable. 374 00:12:46.080 --> 00:12:48.480 It'll probably also be significant as valuable 375 00:12:48.480 --> 00:12:49.680 than somebody whose real time 376 00:12:49.680 --> 00:12:51.960 available to hop on a Zoom call whenever they want, right? 377 00:12:51.960 --> 00:12:53.680 Polar ends of the extremes. 378 00:12:53.680 --> 00:12:56.400 Filter number four is how do I want them to consume the thing? 379 00:12:56.400 --> 00:12:58.080 So they could consume it visually, 380 00:12:58.080 --> 00:12:59.680 they could consume it audio wise, 381 00:12:59.680 --> 00:13:02.720 they could consume it live, they could consume a recording, 382 00:13:02.720 --> 00:13:04.720 they could consume it visually via text. 383 00:13:04.720 --> 00:13:06.560 So there's different ways we can have people consume 384 00:13:06.560 --> 00:13:08.640 some sort of thing whatever it is. 385 00:13:08.640 --> 00:13:10.680 Anything that's live is typically going to be perceived 386 00:13:10.680 --> 00:13:13.240 as more valuable and if it's in person and live, 387 00:13:13.240 --> 00:13:16.000 probably the most valuable and probably the least scalable. 388 00:13:16.000 --> 00:13:18.760 On the flip side, if I did something that was recorded 389 00:13:18.760 --> 00:13:21.120 and was digital, it would be the most scalable 390 00:13:21.120 --> 00:13:22.760 but probably the least valuable. 391 00:13:22.760 --> 00:13:25.640 And that's the seesaw between how much we can charge 392 00:13:25.640 --> 00:13:27.120 and how much value we deliver. 393 00:13:27.120 --> 00:13:29.880 The fifth lens of the delivery cube 394 00:13:29.880 --> 00:13:34.280 is the speed and convenience of whatever we're delivering. 395 00:13:34.280 --> 00:13:36.800 And so this comes down to multiple things. 396 00:13:36.800 --> 00:13:41.280 One, is it 24 hours a day or is it just nine to five? 397 00:13:41.280 --> 00:13:42.960 That's mini frame one. 398 00:13:42.960 --> 00:13:44.840 Frame two is how many days a week 399 00:13:44.840 --> 00:13:46.880 am I maintaining that level of service? 400 00:13:46.880 --> 00:13:50.200 Mini frame three is how fast is that response? 401 00:13:50.200 --> 00:13:52.280 So I might be open 24 hours a day 402 00:13:52.280 --> 00:13:55.240 but I have responses that are guaranteed in 24 hours 403 00:13:55.240 --> 00:13:57.760 which is different than saying I'm open nine to five, 404 00:13:57.760 --> 00:14:00.320 five days a week but I respond within three minutes. 405 00:14:00.320 --> 00:14:01.160 It's different. 406 00:14:01.160 --> 00:14:04.120 And so thinking about the level of service you want to have 407 00:14:04.120 --> 00:14:06.640 on the speed and convenience for your customer 408 00:14:06.640 --> 00:14:08.760 ultimately makes something more or less valuable. 409 00:14:08.760 --> 00:14:11.880 And the ultimate extremes are either you're overstaffed 410 00:14:11.880 --> 00:14:13.640 but your customers don't have to wait 411 00:14:13.640 --> 00:14:15.880 because it means that you incur inefficiency 412 00:14:15.880 --> 00:14:17.440 so that they have convenience 413 00:14:17.440 --> 00:14:19.760 or they incur the inefficiency 414 00:14:19.760 --> 00:14:21.720 and all of your staff is 100% utilized 415 00:14:21.720 --> 00:14:24.400 because they're going to call to call to call all day long 416 00:14:24.400 --> 00:14:26.920 or support to support all day long. 417 00:14:26.920 --> 00:14:29.040 Polar streams, different strategies, 418 00:14:29.040 --> 00:14:31.600 there's wildly successful companies that do both. 419 00:14:31.600 --> 00:14:35.400 And frame six is what I like to call the 10x to 1 10th test. 420 00:14:35.400 --> 00:14:38.960 And this is one of at least my favorite value frames 421 00:14:38.960 --> 00:14:42.560 when I think about any product service thing I want to sell 422 00:14:42.560 --> 00:14:44.520 is frame number one. 423 00:14:44.520 --> 00:14:47.920 If I charge 10 times more for my current thing 424 00:14:47.920 --> 00:14:50.920 what would I have to change about my thing that I sell 425 00:14:50.920 --> 00:14:54.600 in order for it to be worth 10 times more? 426 00:14:54.600 --> 00:14:57.720 This ultimately gets me thinking in much bigger ways 427 00:14:57.720 --> 00:15:00.400 about how much value I would need to provide. 428 00:15:00.400 --> 00:15:03.160 Oftentimes though there are solutions that I think about 429 00:15:03.160 --> 00:15:05.520 when I think of a, let's say I go from a 10,000 dollar thing 430 00:15:05.520 --> 00:15:06.960 to a 100,000 dollar thing 431 00:15:06.960 --> 00:15:09.600 that still would be profitable at a 10,000 dollar thing. 432 00:15:09.600 --> 00:15:10.960 It just makes me think differently 433 00:15:10.960 --> 00:15:14.600 because I now have to justify my 100,000 dollar price tag. 434 00:15:14.600 --> 00:15:16.040 Once you've written out those ideas 435 00:15:16.040 --> 00:15:17.960 the flip side of that is equally powerful 436 00:15:17.960 --> 00:15:21.640 which is if I had to deliver the same or even more value 437 00:15:21.640 --> 00:15:22.800 than I currently am 438 00:15:22.800 --> 00:15:25.200 but I could only charge one 10th the price 439 00:15:25.200 --> 00:15:27.920 that I currently am, what else would I do 440 00:15:27.920 --> 00:15:29.520 that would be perceived as valuable 441 00:15:29.520 --> 00:15:30.600 would not cost me enough 442 00:15:30.600 --> 00:15:33.360 so I could still justify one 10th the price 443 00:15:33.360 --> 00:15:35.320 but maintain my value. 444 00:15:35.320 --> 00:15:37.760 When you think through that you get a whole nother list 445 00:15:37.760 --> 00:15:41.280 of solutions to make your product, service, et cetera 446 00:15:41.280 --> 00:15:42.920 more valuable. 447 00:15:42.920 --> 00:15:44.600 When I go through that delivery cube 448 00:15:44.600 --> 00:15:48.880 and I apply that to the 14 different types of things you can sell 449 00:15:48.880 --> 00:15:50.760 which is seven times the physical 450 00:15:50.760 --> 00:15:52.240 and digital versions of that, 451 00:15:52.240 --> 00:15:53.880 this gives me a very good starting point 452 00:15:53.880 --> 00:15:56.920 to both figure out what the first thing I might want to sell is 453 00:15:56.920 --> 00:15:58.120 and then how can I scale it 454 00:15:58.120 --> 00:16:00.600 and make it more profitable and or more valuable 455 00:16:00.600 --> 00:16:03.640 to my end consumer and think through the ratio 456 00:16:03.640 --> 00:16:06.200 of how many people I would need internally my company 457 00:16:06.200 --> 00:16:09.040 to facilitate that all the way from I wouldn't need anyone 458 00:16:09.040 --> 00:16:12.000 to I'd need tons of people if I sold 100 units. 459 00:16:12.000 --> 00:16:15.520 That is that easy to sell hard to deliver or continue them 460 00:16:15.520 --> 00:16:19.560 where if you choose the most scalable version of this 461 00:16:19.560 --> 00:16:23.040 you could have no employees and sell tons of units 462 00:16:23.040 --> 00:16:25.320 but it would be very difficult for you to get a good price tag 463 00:16:25.320 --> 00:16:27.680 because the value might not be there. 464 00:16:27.680 --> 00:16:30.200 On the flip side, you might need tons of employees 465 00:16:30.200 --> 00:16:32.440 and it might be really easy to sell a super done 466 00:16:32.440 --> 00:16:34.960 for your solution that's 101 that's in person 467 00:16:34.960 --> 00:16:37.800 that you respond to them 24 hours a day within minutes 468 00:16:37.800 --> 00:16:39.920 thinking through all like the extreme versions of this 469 00:16:39.920 --> 00:16:42.240 at a 10X price tag where you currently are. 470 00:16:42.240 --> 00:16:44.920 Sometimes that's still a great way to start your business 471 00:16:44.920 --> 00:16:46.280 because if you don't have a lot of employees 472 00:16:46.280 --> 00:16:47.560 and you only have your time, 473 00:16:47.560 --> 00:16:50.160 maybe you should 10X or 100X your price 474 00:16:50.160 --> 00:16:52.840 and then make all of these other elements of value 475 00:16:52.840 --> 00:16:56.040 from a deliverable perspective available to your customers. 476 00:16:56.040 --> 00:16:58.360 And so when I'm thinking through each of these things 477 00:16:58.360 --> 00:17:01.160 I'm taking off how I want to support each level of value 478 00:17:01.160 --> 00:17:03.680 within the thing that I'm selling. 479 00:17:03.680 --> 00:17:05.240 And so this is what I was explaining 480 00:17:05.240 --> 00:17:07.760 with the University of Texas entrepreneurs 481 00:17:07.760 --> 00:17:10.560 or aspiring entrepreneurs so they could think through 482 00:17:10.560 --> 00:17:12.680 their choice of what to sell the same way 483 00:17:12.680 --> 00:17:14.640 a more experienced business owner might think 484 00:17:14.640 --> 00:17:16.000 of starting a new product line 485 00:17:16.000 --> 00:17:17.880 or starting a new business altogether.