Newsletter Articles

Building your $1 Million Business
by Lauren Lake, SBDC Business Analyst  

Mark Twain once famously said, “The key to getting ahead, is getting started.

I personally, like many of you, have approximately ten different and wonderfully inventive business ideas floating around in my head, waiting to be invested in. Most of them, I am certain, should be the next Google, a world-wide phenomenon and the best thing since sliced bread. But life somehow gets in the way. I don’t have time. Other things are more important right now. I don’t know enough yet to begin. I don’t think I can find the funding for what it would cost. My dog just died. My homework is piling up. I work 50 hours a week paying for someone else’s retirement and the gas bill is due. I have a million and one miserable excuses to not start my business now. Which is why the first step to beginning your million-dollar business, is to begin!

It really can be easier than you believe. A Business Insider article on the serial start-up prodigy, Noah Kagan, speaks of the ease of beginning a business. A business doesn’t have to be a thing mulled over for weeks, months and years until it is perfected. By then, someone else may have capitalized on your inactivity. A business can be founded in as short a time as a weekend! To find profitable ideas and begin your business, comb through websites like Amazon, craigslist, Facebook and eBay and learn what customers are buying and what they are interested in. All a business needs is something that customers are willing to pay for. Successful businesses are often modeled after larger companies, and provide an offshoot product of the original, where market demand was unfulfilled. Sites like Google Trends, Google Insights and market trend reports and also helpful in determining the viability of your idea. Is the market growing? Who are my competitors? Is there a niche my business could fill? You can also use these sites to find how many potential customers would be willing to purchase your product.

Once you have a viable business idea that people are interested in buying, you must decide whether your profits can outweigh the overhead costs and time investment.  Find how much your business will initially cost and how much a customer would be willing to pay.  Whether you want to start a restaurant, sell exotic plants or create an app, you can briefly research how much it would cost to purchase or rent a venue, import plants or hire a graphic designer. Through research and surveys conducted among your friends and family, you can also ascertain how much your consumers would be willing to pay. Based on the research you find (this research does not need to be in-depth, only an overview of the potential success of your company), there is a simple formula for success, called the TAM (Total Addressable Market formula), which is the number of potential customers multiplied by the worth of each customer (how much one person is willing to pay). This yields the revenue opportunity available within your chosen market, and the growth that your company is capable of achieving at the outset.

After all of these steps have been conducted, it is time to begin your business. Not everything needs to be in place for you to start. Begin by generating interest in your product, contacting the other companies that you will need to work with to make your product a reality and offering deals to customers to increase awareness of your new business. If your business is as viable as you researched and found it to be, you are on the right step to making millions and more importantly, investing in your dreams. And even if your business isn’t an overnight success, remember that the majority of businesses take up to three years to turn a profit. Be patient, success comes to those who are willing to work hard and to be persistent.