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This business coaching lesson will discuss the process of discovering your niche to become successful.

Results-Focused Training, Tools, and Workshops from Expert Business Coaches.

Featured Coaching Excerpt - Notes & Transcript, Part 1
  • Startup Principles: 1. Define your goals and when they will be accomplished.
  • Lesson Nugget: You can't achieve your goals unless you write them down!
  • Lesson Nugget: It is worth investing in things that feed your mind!
  • Startup Principles: 2. Put a price tag on what it will cost you to achieve your goal.
  • Definition: Niche - the situation in which a business's products or services can succeed by being sold to a particular kind of people or group of people.

codeacademy for how to start a business

[MUSIC PLAYING]

-Hey, now. My name is Clay Clark. I'm the CEO of thrive15.com, and today I'm going to be teaching you specifically how to start a business and how to find the right business niche, the right business niche. It can help you achieve your big business goals. And so if you've ever felt like I want to start a business. I want to start a company. I want to get started. I just don't know what kind of company I want to start.

You're not alone. In fact, a lot of people don't know where to start. So we're going to teach you kind of the art of the start. We're going to teach you how to find that niche, so you can scratch it. We're going to teach you specifically how to find a niche that you can solve, a problem that you can solve in the marketplace, and you can charge customers to solve that problem and get paid for it.

So today if you ever felt stuck, and you don't know where to start, this episode is for you. Remember, at Thrive, we all believe that knowledge without application is absolutely meaningless, so as you're watching today's episode, you really have to take the time to ask yourself, what do you need to do to apply this principle in your own life and business? Otherwise, today's episode is more meaningless than getting a can of Pringles and popping the top and then having a chip and then trying to stop, because you can't stop.

Today we are talking about startup and how to start a business, but specifically, we're talking about discovering your big niche that'll help you achieve your big dreams. We're trying to help you discover your big niche. Some will call it a niche. Your big niche that will help you achieve your dreams. What's a niche? It's kind of like where you fit in, your specialty, your thing you do, kind of where you fit in the world in your own little specialty that you can do to make some money there.

So step one here to discover your big niche that will help you achieve your big dreams is we have to define our goals. We have to define our goals. And I want to make sure that everybody who's watching this that you do this. If you need to pause it right now and do this, that's fine, but you have to do it. So what you have to do is you have to, one, define your spirit goals, your mind, your body, your relationships, and your final one, your finances. You have to do it. If you do not have these goals written down, I promise you you will not achieve them.

[GRUNTS]

If you don't have these goals written down, you cannot achieve them. You have to write them down. You have to write them down. Whatever you're doing, please write them down. Spiritual goal. And I'm going to give you a time limit. One year from now, where do you want to be with your spiritual life? Mind? These are actual skills. One year from now, where do you want to be with your skills one year from now? Body-- in terms of your fitness, your physical fitness, where do you want to be one year from now?

In terms of your relationships, maybe have a brother you haven't talked to, or you have a girlfriend you want to marry, or maybe you have a dude you want to get closer to, or you have a partner you want to meet, or a mentor you want to get to know-- relationships-- where you want to be one year from now.

And financially, where do you want to be one year from now? One year. You have to define those goals. That is absolutely important. Now why is it so important that we do that? Somebody's watching right now saying, you know, I just don't know what my goals are right now. I don't know. I don't know. Well, here's the thing. You have to have some sort of goal, because step number two, step number two in our system here is you have to put a price on it.

So I want you to ask yourself, what does it cost for you to achieve that goal? What does it cost for you? Now you said, relationships? I can't put a price on that. Well, I think you can. Going out to coffee, going out to eat, maybe taking your girlfriend on a date, maybe paying for the wedding, paying for a vacation, maybe taking your kids to the pool, maybe taking your kids to a country club, maybe taking your kids to a movie, maybe taking your kids to a park, maybe taking your kids to-- I have five kids, so I'm thinking about a lot of kid things.

Maybe you're single. Maybe it's just taking someone out to eat, meeting people, maybe it's having an apartment, I don't know. But you have to-- it costs you money. It costs you money to stay in shape. What does it cost to go to the gym? What does it cost for supplements? What does it cost for a trainer? What does it cost to be in a class? What does it cost? What does it cost? What does it cost? Things on the planet Earth-- not Urs-- but Earth cost what? Money. Mind. Skills.

I mean, is it healthy go to a workshop? Yes. Does it make sense to pay $1000 dollars to go to a workshop? I mean, let's say you're a sign printer. You're in the printing industry, or you're an insurance salesperson. Should you pay to go to a seminar occasionally to learn some new skills? Yes. In certain professions, does it makes sense to go back to college? Yes. Does it make sense to get certain certifications? Does it cost money? Yes. And spiritually, some of you guys go to a church where you tithe, you give 10% of what you earn.

Some of you have a faith where you give back. Some of you have certain-- you want to travel to a place on a kind of a spiritual journey. But what does it cost? That is the question is what does it cost? So step one, you have to define your goals, and then two, you have to ask yourself, what does it cost? Now as we move on, phase number three. So again, step one is to define those goals. Step two is to ask yourself, what does that cost?

Featured Coaching Excerpt - Notes & Transcript, Part 2
  • Startup Principles: 3. Find a problem you can solve.
  • Ask Yourself: Can I think of a problem that isn't being solved or that I can solve better than anyone else?
  • Startup Principles: 4. Draw up a rough business model.
  • Steps To Create A Business Model: A. Define Rough Costs
  • Lesson Nugget: Make sure the problem you are solving is a problem someone would pay to have solved.
  • Lesson Nugget: A business model contains the specific steps and nuances you business does differently than other businesses , and describes how the business delivers value to the customer.
  • Hard Costs: Hard costs are payments that you have to make regardless of whether or not you sell something.

-What does it cost? Now, moving on to step number 3. Step number 3 is you want to find a problem that you can solve. You want to find a problem that you can solve better than anybody else in your area. You want to find a problem. Find a problem.

So I'm going to give you a few examples. But I know of a guy I've done some work with who's a dentist. And he has said, gosh, a lot of dentists aren't open on Saturdays. so he's out there in the West coast, and he says, I think I'm going to be open on Saturdays. That's a problem. People, like me, have teeth. They need to get their teeth taken care of. They work at job, 9:00 to 5:00, Monday through Friday, and they need to be able to get in on a Saturday.

So what he did is he opened up his place on Monday through Saturday, 9:00 to 7:00. Why? Because most people get off work at 5:00. And so all he did was extended his hours till 7:00. He opened it up on a Saturday, and he's like, boom, that's my niche. That's my thing I do. That's my problem I solve. I find a problem that I can solve.

Now, another example. My company I started was called DJ Connection. Well, DJ Connection, brides and grooms coast to coast, all around the world are used to paying a DJ by the hour. You pay a DJ for four hours of his time. You say, it's this much money. It's like $600 for four hours. Is $1,000 for four hours. You pay for the hour.

Also, the DJ, you had to choose from his song list. Also, you never had an opportunity to sit down with the DJ to help plan out your event. So I said for our company, you know what the problem that girls have is they want unlimited time, brides and grooms, they want unlimited time-- I say girls because it was almost always the bride booking her wedding. It was almost always the lady booking the holiday party.

But they wanted unlimited time. They wanted to be able to choose their music. And they wanted to meet with an event planner. And that was a problem. And so I solved the problem.

So if you're watching this right now, you have to ask yourself, step number 3 is find a problem that you can solve in the marketplace. Now, this should be like a game. This should be a deal where you're constantly asking yourself, what's a problem I can solve? What's a problem I can solve? What's a problem I can solve? You want to ask yourself that question over and over and over.

And then you have to make sure this is a problem that someone is willing to pay to have solved. So step three, find a problem that you can solve but that people would be willing to pay for.

Now moving on to step number 4. This is where it begins to get a little bit exciting. Because you're going to have some business action steps that you can do here. You're creating a business model. So you're going to define a rough business model.

What is a business model? A business model is a system with which we do business. It's how we do business. It's the specific steps, the nuances, the differentiators. It's what makes us different. It's the processes that we use to deliver value to the customer. This is how we solve problems. We define a rough business model. This is how we charge the customer for solutions.

And this is what you do if you want to make a business model. These are the steps. One is you want to define your rough costs. These are your rough, very, very rough hard costs, your rough hard costs.

What does that mean? Your hard costs are items that don't go away if you start a business. Those are hard. They're fixed costs. They're costs that don't go up. They don't go down. They're just a hard cost. Example-- your phone bill every month for a business would be a hard cost for a lot of people. It's like $100 a month, it never goes up, it never goes down. It's just your hard cost.

Your lease for your office space-- you might pay $2,500 a month every single month for your office space. That's a hard cost. So let me just write down some of these hard costs for you. That would be your lease. That would be your phone, and that would be maybe your insurance. That would be anything like accounting, maybe, anything that's a fixed expense.

This does not go up. This does not go down. It is a cost associated with just being a business, being just open, having your doors open. Even if you don't sell anything, this cost does not go up or go down. I hope I'm helping you here. That's a hard cost.

Featured Coaching Excerpt - Notes & Transcript, Part 3
  • Lesson Nugget: Variable costs are the costs that change with sales. These include cost of goods sold, commissions, and any other costs that change depending on sales volume.
  • Steps To Create A Business Model: C. Break-Even Point
  • Lesson Nugget: The break-even point is the point in which your sales pay all of your costs and you are no longer losing money on your fixed expenses.
  • Steps To Create A Business Model: B. Determine Your Variable Expenses
  • Steps To Create A Business Model: D. Determine Profit Per Customer After Break-Even Point

-The second thing we have to do to make our business model-- again, roughly-- we want to come up with-- these are called variable expenses. OK? Variable expenses. We need to figure out what our variable costs are. We have to figure out, per transaction, what does it cost us?

So let's just make up an example. Let's say you sell cupcakes. Well, if you sell a cupcake for, let's say, $4, how much does it cost for the eggs that go into one cupcake? And for the mix-- the cake mix. And what does it cost to actually bake it in terms of the electrical costs? You're like, you need to measure the electrical costs needed to make one cupcake? Yes.

Frosting, what does that cost? What does it cost in labor to pay someone to do it? What does it cost-- those little tins-- those little tins that you put your cupcake mix in that keeps the cupcake from sticking to the pan? You know that stuff? What does that cost? All this stuff, what does that cost?

You have to add up all of the costs, because every time you sell a cupcake, you have to pay these costs. Make sense? You have to add up all these costs every single time. If you're a builder, that would be like every time you build a house. I mean, you've got to build what? The cost of the wood, the cost of the sheet rock, the cost of your labor, the cost, the cost, the cost.

You have to think about your variable costs. The costs that, per transaction, happen. These are costs that do not happen if you do not actually sell anything. Does that make sense? I hope you're getting it. If you have any questions, email us at info@thrive15.com, I'll help you.

But that's what that is. OK? Variable expenses, that's what that is. It's the cost per transaction. It doesn't happen unless you actually sell something.

Whereas a fixed cost, even if you don't see any customers at all, you have the same fixed cost. So you have the hard costs versus variable costs. Are we losing anybody out there? If you're lost, it's OK. I took algebra three times, I promise we're going to help you on this. OK?

So now we're moving on into this third element. This third element is very important. We have to figure out our break even point. This is all on our rough business model. Just go to our business model, OK? We have to have our break even point.

So the question is, how many sales equals break even? So go with the cupcake analogy. Let's say that every cupcake was $4, and after taking out the cost to make them, we have a profit of $2. But yet, we need to do at least 1,000 sales a month just to break even.

Well, I don't know where you're office-ing if you're only going to pay $2,000 a month and that also includes your insurance and your-- I mean, maybe you have a loan for your company. And that includes your utilities. I mean, that's a pretty low cost.

But you'd have to-- if you owned a cupcake business that sold cupcakes at $4 apiece, you'd have to sell at least 1,000 of them a month just to bring in that sort of-- so you want to ask yourself, what's my break even point? How many transactions do I have to do just to break even? How many sales equal break even? OK? Make sense? How many sales do I have to do just to break even?

And then finally, you want to figure out after your break even, what is your profit per customer. So how much profit do you actually make per customer. So after you break even, how much do you make? So once you've paid off the bills. Let's just assume that under this model it was 1,000 cupcakes just to break even. Well, every cupcake after that, how much do you make?

Well, in this model, we would make $2 of profit per cupcake after we break even. So we would make under this model $2 of profit per cupcake after we break even. Am I helping somebody?

-Amen.

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