The $100 Startup by Chris Guillebeau

modified 2018-11-08

Book notes for Fire Your Boss, Do What You Love and Work Better to Live More

If I needed money, I learned to think in terms of how I could get what I needed by making something and selling it, not by cutting costs elsewhere or working for someone else. This distinction was critical, because most budgets start by looking at income and then defining the available choices. I did it differently—starting with a list of what I wanted to do, and then figuring out how to make it happen.

Location: 100 There’s no rehab program for being addicted to freedom. Once you’ve seen what it’s like on the other side, good luck trying to follow someone else’s rules ever again.

Page: 10 I excluded businesses that were in “adult” or quasi-legal markets, and in most cases also excluded businesses that were highly technical or required special skills to operate. The baseline test was, “Could you explain what you do to your grandmother, and would you be willing to?”

Page: 16 I succeeded as a cartoonist with negligible art talent, some basic writing skills, an ordinary sense of humor and a bit of experience in the business world. The “Dilbert” comic is a combination of all four skills. The world has plenty of better artists, smarter writers, funnier humorists and more experienced business people. The rare part is that each of those modest skills is collected in one person. That’s how value is created.2

Page: 24 Many businesses are modeled on the idea that customers should come back to the kitchen and make their own dinner. Instead of giving people what they really want, the business owners have the idea that it’s better to involve customers behind the scenes … because that’s what they think customers want.

Page: 28 Ask three questions for every idea: a. How would I get paid with this idea? b. How much would I get paid from this idea? c. Is there a way I could get paid more than once?

Page: 33 He also didn’t depend on advertising revenue, something that very few people in our study mentioned. Instead, he created products and services himself, offering downloadable guides and an ongoing training school.

Page: 38 We’ll return to Brooke’s theme several times throughout the book. I call it the freely receive, freely give approach. When all else fails, ask yourself how you can help people more. What

Page: 43 There is no “consulting school” or degree. You can start a new business as a consultant in about one day, if not sooner. Follow these two basic rules: 1. Pick something specific as opposed to something general. Don’t be a “business consultant” or a “life coach”–get specific about what you can really do for someone. 2. No one values a $15-an-hour consultant, so do not underprice your service. Since you probably won’t have forty hours of billable work every week, charge at least $100 an hour or a comparable fixed rate for the benefit you provide.

Page: 58 After I adjust to the time difference over the next couple of days, I settle into a routine of morning work and afternoon exploration. At least one week a month, I live in this dream world of travel, work, and frequent coffee breaks. The business is structured around my life, not the other way around. I know what some people think: It sounds like a fantasy. Well … it really is happening, on a broad scale, for thousands of people all over the world. My example is just one of many; let’s hear about a few others.

Page: 68 Months later, sales of Evernote Essentials continued to bring in at least $300 a day, projecting annual revenue of more than $120,000 for something that was essentially a side project. Interestingly, if the project had been produced as a print book from a traditional publisher, those numbers could be considered a failure—author royalties would have brought Brett only around $18 a day. But since Brett was the sole owner and delivery was digital, the $300 that arrived in his PayPal account every day was almost entirely profit.

Page: 82 helps to be specific; asking people if they “like” something isn’t very helpful. Since you’re trying to build a business, not just a hobby, a better method is to ask if they’d be willing to pay for what you’re selling. This separates merely “liking” something from actually paying for it. Questions like these are good starting points: • What is your biggest problem with ______? • What is the number one question you have about _______? • What can I do to help you with _________?

Page: 105 it’s usually better to highlight a core benefit of your business instead of a descriptive feature. Accordingly, you can revise the statement a bit to read like this: We help [customers] do/achieve/other verb [primary benefit]. Focusing like this helps you avoid “corporate speak” and drill down to the real purpose of the business as it relates to your customers. Here are a few examples: If you have a dog-walking service, the feature is “I walk dogs.” The benefit is “I help busy owners feel at ease about their dogs when they’re not able to be with them.”

Page: 123 Immediately after buying something, we often experience a pang of anxiety: Was this a good purchase? Did I waste my money? You’ll want to get out in front of this feeling by making people feel good about the action they just took. The easiest and most critical way to reinforce their decision is by giving them quick access to what they paid for. But to go further, you’ll want to overdeliver: give them more than they expected. You can do this by upgrading their purchase unexpectedly by sending a handwritten thank-you card in the mail or in whatever way makes the most sense for your business. The point is that the small things count.

Page: 134 If you admit to a flaw, weakness, or limitation in your product, this will probably help instead of harm you. This is because when we are evaluating a purchasing decision, we like to consider both the strengths and the weaknesses. If a product developer personally tells us it’s not perfect—“and here’s why”—we tend to trust him or her more.

Page: 150 When you’re first getting started with a project, how do you go from martyr to hustler? It’s simple. First things first: Take the time to make something worth talking about—don’t be a charlatan. But then start with everyone you know and ask for their help. Make a list of at least fifty people and divide them into categories (colleagues from a former job, college friends, acquaintances, etc.). As soon as the project is good to go, at least in beta form, touch base by sending them a quick note. Here’s a sample message: Hi [name], I wanted to quickly let you know about a new project I’m working on. It’s called [name of business or project], and the goal is to [main benefit]. We hope to [big goal, improvement, or idea]. Don’t worry, I haven’t added you to any lists and I won’t be spamming you, but if you like the idea and would like to help out, here’s what you can do: [Action Point 1] [Action Point 2] Thanks again for your time.

Page: 154 John Morefield, an unemployed architect during a time when jobs were scarce, set up shop in a Seattle farmer’s market with a sign that read “5-Cent Architecture Advice.” In exchange for a nickel, he would give advice on any problem that homeowners, real estate agents, or anyone else brought to him. The 5-cent advice was effectively a lead-generation program that might lead to additional business, but John legitimately and genuinely offered professional advice without the expectation of more than a nickel. As news spread of the 5-cent architect, John got free advertising from CNN, NPR, the BBC, and numerous other media outlets.

Page: 165 On any given day, there are all kinds of things you can do that have nothing to do with making money—but you should be careful about those distractions, because without the money, there is no business. Many aspiring business owners make two common, related mistakes: thinking too much about where to get money to start their project and thinking too little about where the business income will come from. Fixing these problems (or avoiding them in the first place) requires a simple solution: Spend as little money as possible and make as much money as you can.

Page: 171 1. Price your product or service in relation to the benefit it provides, not the cost of producing it. 2. Offer customers a limited range of prices. 3. Get paid more than once for the same thing.

Page: 180 I wanted to check something in my product. I set up an experiment that only tested a single variable: price. On one sales page I had $49, and on another $89. Nothing was different at all—same copywriting, same order process, same fulfillment. To be honest, I thought that $49 was a better price, but I had set that price somewhat arbitrarily. Guess what? Conversion went down … slightly. But overall income actually increased! This is what really surprised me. I discovered that I could sell less but actually make more money due to the higher price. I then decided to test it at $99. Why not, right? But from $89 to $99 I saw a bit more of a drop-off, and I got worried. I’m now back at $89, and even with the lower conversion factored in, I worked out that I’ve given myself a $24 raise on every product that sells. These days we are selling at least four copies a day. If everything else remains consistent, I’ll make $35,040 more this year

Page: 193 If you have a product business, ask yourself this question: “My product is x … how can I teach customers about y?” Then create a new version of your offering that includes consulting, coaching, a “jump-start” session, premium technical support, or something else.

Page: 196 Great displays (in store) and great photos (online). Display, color, and placement are important, so Happy Knits includes a staging area for professional photos in a back room of the store. I asked Sarah why she doesn’t just use the photos provided by the manufacturer the way other stores do. “Because they’re not good enough,” she told me. “We try to do everything here with a focus on quality.”

Page: 201 Horizontal expansion involves going broader by serving more customers with different (usually related) interests; vertical expansion involves going deeper by serving the same customers with different levels of need.

Page: 215 I actually prefer not to work with contractors, employees, or assistants. My business succeeds on the fact that it is intentionally small. I can fit my whole business into a backpack and take it wherever I go—no office, no stationery, no administrative staff. Keeping my overhead to zero has lowered the risks and kept profits high. —Adam Westbrook (Adam operates a design services business from the United Kingdom

Page: 233 When asked about any bad days or negative experiences in the business, Tom said something I’ve been thinking about ever since: “All the bad days have two things in common: You know the right thing to do, but you let somebody talk you out of doing it.” At least in this case, Tom never let himself get talked out of what was clearly the right thing for him.