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Slide 1: How to turn your million-dollar idea into a reality (from the man who sold the MCG)
Slide 3: How to turn your million-dollar idea into a reality (from the man who sold the MCG) FROM Imagination to Implementation PETE WILLIAMS
Slide 4: First published in 2006 by Wrightbooks an imprint of John Wiley & Sons Australia, Ltd 42 McDougall Street, Milton Qld 4064 Offices also in Sydney and Melbourne Typeset in Berkeley LT 11/13.2 pt © Pete Williams 2007 The moral rights of the author have been asserted National Library of Australia Cataloguing-in-Publication data Williams, Pete (Peter John), 1982- . How to turn your million dollar idea into a reality (from the man who sold the MCG) : from imagination to implementation. Includes index. ISBN 0 7314 0575 7. 1. Entrepreneurship. 2. Creative ability in business. 3. Organizational effectiveness. I. Title. 658.421 All rights reserved. Except as permitted under the Australian Copyright Act 1968 (for example, a fair dealing for the purposes of study, research, criticism or review), no part of this book may be reproduced, stored in a retrieval system, communicated or transmitted in any form or by any means without prior written permission. All inquiries should be made to the publisher at the address above. Author photo © Jo Patterson Cover image © Newspix/Damian Horan Pages 27–28 Reproduced with the permission of Yahoo! Search Marketing Australia Page 132 ‘Magical Carpet Ride’ by Chris Tinkler, Sunday Herald Sun, 3/8/03, p. 25, The Herald & Weekly Times. The Herald & Weekly Times Photographic Collection/Faith Nulley. Pages 101–12 Reproduced with the permission of Shannon Curtis www.profitableclothingret ailer.com Page 176 Reproduced with the permission of Google Inc. Printed in Australia by Griffin Press 10 9 8 7 6 5 4 3 2 1 Disclaimer The material in this publication is of the nature of general comment only, and does not represent professional advice. It is not intended to provide specific guidance for particular circumstances and it should not be relied on as the basis for any decision to take action or not take action on any matter which it covers. Readers should obtain professional advice where appropriate, before making any such decision. To the maximum extent permitted by law, the author and publisher disclaim all responsibility and liability to any person, arising directly or indirectly from any person taking or not taking action based upon the information in this publication. iv
Slide 5: Contents Introduction From imagination to… 1 idea conception 1 2 fearlessness 9 3 finding your million-dollar idea 23 4 standing out and making a name 41 5 setting goals for success 57 6 planning the journey 67 7 profitable systems 75 8 pricing for profit 89 9 the technical stuff 105 10 profitable publicity 117 11 effective marketing 135 12 influence factors 157 13 clicks and portals 171 14 back-end profits 189 15 networking 201 16 team force 213 17 barter profits 223 18 creative business 235 19 the ultimate business model 245 Conclusion 251 Index v
Slide 6: To Mum and Dad, thanks for providing such a strong foundation
Slide 7: Along with all my family and friends I would like to thank the following people for their guidance, love, support and education over the years. Fleur Byrt Bruce Hultgren Jon Michail Michael Hanrahan Paul Breen Jay Abraham Adam and Magentaline Troy Bowen Rohan Merry Robert Kiyosaki Tony Stewart Adam Bowen Garry and the Gaggle Tony Robbins Seth Godin Scott Ginsberg Mark Victor Hansen Sarah Felton Jonathan Jackson Matt Tabone and ‘the uni-crew’ Brian Tracy Robyn Webb Glenn Williams Nev Bray Akshay Shah Gary Halbert Rick Doherty Ross Mitchell Richard Branson Trav Madden Andrew Pickett Michael Port Dr Tony Alessandra Belinda Stewart Phil Hodgson Nicole Strano Richard Koch Guy Kawasaki Dale Beaumont Peter Sorenson Yaro Starak Brent Hodgson Shannon Curtis Robert Allen Tory Favro John Burley Camille Howard Dan Kennedy Taz and Amy Adam Birrel Sam Corriea Danny Drake and the cash flow crew Chris and Abbey Rick Frishman The team at Wiley Billi Lim Darren and the MJCC Dave at Frame-mem Trevor Price and the Supercats Sport The Library Simon and Maz Tegan Gray Jade, Ness and Rach Matt Barkley Ted Whitten Jnr Max and The Kardinia Picture Framing Team The Porter Family Jay Conrad Levinson Christina Posnachiwsky Steve McKnight Cindy Cashman Paul Hartunian
Slide 8: What people say about How to turn your million-dollar idea into a reality I wish I had read this book years ago! Pete’s ideas will transform the stuff in your head to the stuff in your wallet. His tips, systems and ideas, combined with his intelligent writing style makes this a must read! Scott ‘The Nametag Guy’ Ginsberg (author of How to be That Guy and Make a Name for Yourself) Australia needs more entrepreneurs like Pete Williams to keep the cogs of industry turning and the left-field business fires burning bright. Pete proves that entrepreneurial spirit is alive and well in Australia. Jonathan Jackson (editor — Wealth Creator magazine) This book is the bible for those looking to launch a new idea or business. It will literally save you thousands in lost time and money. Shannon Curtis (author of The Referrals Marketing Toolkit) Peter has done a brilliant job with this book, it certainly is a dynamite read. Through various practical examples it proves to all of us that success, both personally and financially, can come rapidly with minimal time and effort. Absorb these principles and put them into practice — they really work! Dale Beaumont (creator of the Secrets Exposed series, young entrepreneur, best-selling author and international speaker) Read this book before you start any entrepreneurial venture. Not only is it full of advice from Pete’s remarkable experiences but the lessons are reinforced by real-world examples from various companies, both big and small. Michael Port (author of Book Yourself Solid: The Fastest, Easiest, and Most Reliable System for Getting More Clients Than You Can Handle Even if You Hate Marketing and Selling) The lessons and techniques Pete has shared in this book will help you gain the competitive edge in whatever business you choose to pursue. It’s full of unique street smart marketing ideas that anyone can easily put into place. After reading just one chapter, I felt I received more valuable ideas than I received after reading all the chapters in other books. Dr Tony Alessandra (author of The Platinum Rule and Charisma) viii
Slide 9: Introduction You shouldn’t be allowed to start a business without reading this book three times. The techniques and secrets Pete shares are worth far more then the cost of the book. You should have read this book yesterday. Rick Frishman (President of Planned Television Arts and co-author of the AUTHOR 101 series, <www.author101.com>) Pete is a role model for young entrepreneurs; I suggest every entrepreneur take the time to read his book! Cindy Cashman (million-selling author, <www.firstspacewedding. com>) How to turn your million-dollar idea into a reality combines two of my favourite elements in a book — a great story and practical business lessons. When you walk away from reading a book feeling both entertained and educated you know you have found something unique and worth sharing with others. Take my advice, read Pete’s unique entrepreneur story and use it as inspiration and motivation to create your own. Yaro Starak (entrepreneur, <www.entrepreneurs-journey.com>) Ideas can be found anywhere but turning them into reality is what makes the great difference and that’s what Pete’s book can help you do. Billi Lim (author of the No.1 bestseller Dare to Fail) From getting your great idea off the ground to making your brand stand out from the crowd, Williams’ candid approach in How to turn your million-dollar idea into a reality is full of simple and practical advice for budding entrepreneurs. Camille Howard (editor — Dynamic Business magazine) Pete Williams is the perfect example of entrepreneurial spirit that should be nourished in our youth — How to turn your million-dollar idea into a reality covers many practical gems that will inspire the reader to action their dream and create their reality. Jon-Michail (Australasia’s No. 1 Image Coach and CEO — Image Group International) Pete writes with entrepreneurial verve and his simple advice could just inspire you to make a fortune. Great stuff! Richard Koch (author of the bestselling The 80/20 Principle) ix
Slide 11: Introduction Eliminate the time between the idea and the act and your dreams become your realities. Dr Edward Kramer My first lesson to all you budding entrepreneurs out there is this: your business won’t start itself. Your fantastic product idea will not simply materialise in front of you if you wish for it hard enough. Your great business plan will not magically appear on your desktop one day, in a file titled ‘Guaranteed road to riches.doc’. The first step to success is implementation. This book is about turning your great idea into a great business. Million dollar ideas are everywhere. I know people who have five of them before breakfast. And we’ve all had the experience of having a good idea but not doing anything about it, only to see it appear six months later courtesy of somebody who got off their bum. There’s nothing worse than the ‘that could have been me’ feeling. Million dollar ideas are not worth a million dollars if they are still inside your head. They won’t make any money there. I’m going to show you how to turn your million dollar idea into reality — and hopefully a million dollars! xi
Slide 12: How to turn your million-dollar idea into a reality Me at my desk, age four. I have my phone, my helmet and my teddy — all ready for action! About me … I have always been entrepreneurial. One of my earliest memories is of Mum in the kitchen. I came out and dragged her into the hall to show her what I had drawn on the walls. No, I hadn’t drawn a house with a chimney in bright yellow crayon. I had drawn arrows leading to my ‘office’, so that Mum could find me (or in case any important clients came by). I was about four years old. Where I really cut my teeth as an entrepreneur was at our holiday place in Ocean Grove; I spent all my summer and Easter holidays there. When basketball card collecting was big, I arranged a huge swap meet at the caravan park — I put advertisements all over the park, arranged stalls, and allowed others to set up stalls at my swap meet. I also set up a TV and video in the window of our caravan, facing outside so kids who had to wait their turn to purchase the rare and collectable cards I had on offer didn’t get bored and wander off. It was very successful and I had my first taste of creating my own income. During the whole basketball trading-card fad, I also started a newsletter about basketball trading cards, with stories about cards and their values. xii
Slide 13: Introduction In my first week I doubled my number of subscribers. Not many people can claim that! And if I had signed up another two people, I would have doubled my readership again. Unfortunately my cousins Adam and Simon remained my only recipients, but I did learn early about the importance of having a database and keeping in touch with clients. During another Easter holiday, my cousins and I raised money for the Good Friday appeal: we made a range of greeting cards for the people in the caravan park to purchase. We set up a stall near the toilet and laundry block — to maximise foot traffic. The funny thing was that my aunty, who had the responsibility of sending the money in, actually forgot that year and the money didn’t make it. (She saved it and sent it the next year.) I learnt at the age of about 11 that you must have good people around you and advisers who know what they are doing! When I was 16 my folks and I went to America for a holiday and basketball tour. When we were in Vegas as part of the tour there was a store that put your face onto the body of a famous athlete or model, or on King Kong. While my mates were being Michael Jordan, or posed with girls in bikinis, I chose to put my face on the cover of a business magazine that had the lead story ‘Entrepreneur of the year’ — yes, perhaps I’m a bit of a nerd. I was in high school when I became serious and registered my first business name — Impact Plus — and created websites for my high school, primary school, the Geelong Supercats (yes, you’ve probably noticed I’m a basketball fan), and a few other businesses. As you can see, I’ve had an entrepreneurial streak since before I could spell entrepreneur (though I still get it wrong sometimes). And yes, I am only 24 years old, but that’s one of my key points — don’t let age stop you! You are never too young, or too old. The experiences I had selling the ’G are the basis for many of the discussions in this book, and I was only 21 when I did it. When I started down the road to selling the ’G, I had just returned from overseas and had little money or time. I was only in my early twenties, so I didn’t have a lot of cash, and I worked full-time. I asked myself, how do I start a business like this? Impossible, I xiii
Slide 14: How to turn your million-dollar idea into a reality hear you say. Well, it’s not — and you can do it too. I started with a headline-grabbing idea, and used this to generate free publicity. I created systems that allowed me to operate the business with minimal time and financial commitment, and leveraged my efforts using other people’s time and skills. And there are many other methods that I used to reach my seemingly unreachable goal. All of this will be covered here, and there are more resources available at my website: <www.preneurmarketing.com.au>. What’s in this book In this book you will find the lessons I have learned about business and marketing — from both a practical and theoretical perspective. My MCG venture proves what you can do with a great idea, and I will pass on the knowledge I gained from this, as well as from working with my clients and associates. This book is full of useful facts, examples, quotes, stories and information that will help you get out there and implement your own great idea — from the basics of how to register a business name and finding a market, to setting prices and maximising profits. We will also look at what is one of the single biggest problems for many people — the fear of getting started. I also believe it is important to have a theoretical understanding of business and marketing. I have studied both at post-graduate level, read endlessly about these topics, and have learned a lot from my business mentors. I will use this knowledge to provide you with a theoretical background that will help you get your ideas out into the world. We will look at marketing strategies, business planning and structuring, and using what other businesses have done to help you develop your own ideas. Throughout this book you will notice references to the From Imagination to Implementation Workbook. This workbook will allow you to apply what you have read in this book to your business, and when you are finished it will provide you with a powerful tool to help you get your business off the ground. Normally the workbook is priced at $79.95, but a free downloadable version is available xiv
Slide 15: Introduction exclusively to readers of this book. Go to <www.preneurmarketing. com.au/workbook.php> to get your copy today. Entrepreneurs There is more interest today than there has ever been in entrepreneurship. Successful business people are now prominent figures in society, and some are even celebrities. For instance, Richard Branson and his crazy publicity stunts often appear in the media and Bill Gates is a household name. But these two started off just like most of us — unknown, and with only a small amount of money. They both had great ideas, but, more importantly, they had the drive and the desire to do something with those ideas. Whatever your aspirations, there are valuable lessons to be learnt from people such as Branson and Gates. Finally, I believe entrepreneurship should not just be about the money. Of course making money is a major reason why people want to become entrepreneurs, and if you are successful there will be no shortage of it. But you must also enjoy the challenge that comes with the journey — there will be obstacles along the way, and your attitude and level of enthusiasm will determine whether these stop you cold or you find a way around them. Also, you can be certain that there will be hard work involved, especially in the start-up stages. But these aspects only add to the satisfaction when the job is done; remember, if it was easy, everybody would do it. Find out now how to take your idea from imagination to implementation. Best of luck, Pete Williams Melbourne September 2006 xv
Slide 17: Chapter 1 From imagination to ... idea conception The value of an idea lies in the using of it. Thomas Edison Key points What you do with your idea is just as important as the idea itself. You don’t need special skills to make your business a success, just an idea and some enthusiasm. Anybody can do it. Don’t let an opportunity pass you by. Work hard to achieve your goals. Before you can make a start on becoming an entrepreneur, you must have an idea. You can have an earth-shattering, oh-my-godwait-’til-people-hear-about-this idea, but it doesn’t have to be. A modest but well-executed idea will go further than a fantastic idea that is poorly implemented. You can also borrow or adapt an idea from elsewhere, as I did. Much of what you will read in this book is based on my idea of ‘selling the ’G’, as it has become known. So what better place to start than to tell you how it happened? 1
Slide 18: How to turn your million-dollar idea into a reality Selling the ’G After returning from a stint in 2002–03 working for The Athlete’s Foot in the USA, I went back to work at The Athlete’s Foot in Werribee. The plan was to work there for a few months, before heading back to the US to start a business career. As it was a store in its infancy, I often spent morning shifts there by myself, so to keep occupied I often read. One morning I was reading The One Minute Millionaire by Robert Allen and Mark Victor Hansen, which is a fantastic read for budding entrepreneurs, and one of the stories it tells is of a New Jersey man who bought pieces of the Brooklyn Bridge in New York. Paul Hartunian had seen a story on television about part of the wooden walkway being removed from the Brooklyn Bridge because it was old and rotting. Straightaway he had an idea. One of the workers was being interviewed for the story, and in the background Pete’s tip: Paul could see the contractor’s truck go your own way with his phone number on the side. If you do what everybody Paul contacted him immediately else does, you’ll never be able and made a deal over the phone to to set your business apart. buy the wood for $500, and it was Many businesses focus on delivered later that day by the slightly advertising simply because bemused worker. Hartunian made they think that it’s the only up small A5 certificates detailing the way to attract attention to history of the bridge and attached a their business. Be different small piece of the Brooklyn Bridge’s — use publicity to build your timber to it, and began to sell the business. certificates for US$14.95. He also wrote a press release, which he sent out to the media, and within days he was bombarded with enquiries and interview requests. This initial effort generated publicity for Paul for the next six months, and that was just the start. I instantly loved the simplicity yet effectiveness of the idea, and began to think about how I could replicate this in Australia. The image of the MCG’s redevelopment, which had just begun, came to mind. I thought I might be able to get my hands on some of 2
Slide 19: From imagination to idea conception the timber and replicate Paul Hartunian’s venture. I rang Bruce Hultgren, who is one of my business mentors and a good friend. (He runs a business creating programs that use music to help children learn ball skills: <www.billybounce.com>.) A serial entrepreneur like myself, he saw the dollar signs, and the phone calls to track down the timber began. Eventually we got in contact with the wrecking company that had pulled down the MCG’s Ponsford Stand and they informed us that not only did they have some of the timber but they also had rolls and rolls of the crested carpet from the MCC members’ section in the Ponsford stand! As a sports fan and a collector of memorabilia, I thought this would be a great chance to preserve a piece of Australian sporting history and make it available to fans, as well as a great business idea. I arrived the next morning to see and secure the purchase I had made over the phone the previous day. To my amazement the carpet was sitting in the back of the warehouse getting damp; it blew my mind. They also had the bar, which had the MCC logo on it. I negotiated to purchase that also, but later found out that the Variety Club had shown interest and had secured it with another of the warehouse reps the day before — I was not going to argue with a charity. I believe they later auctioned it off and raised a great deal of money for their wonderful organisation. The winner is the chef who takes the same ingredients as everyone else and produces the best results. Edward de Bono I arranged for a courier to pick up all the timber and carpet and deliver it to my house, in Bacchus Marsh. The carpet lived in the garage for a few weeks, but I was scared that it would get wet there so the timber and carpet was relocated into the study and the rumpus room. In the early stages I received a great deal of support and help from an associate and mentor of Bruce’s, Phil Hodgson, who helped with the idea development and the wording of the plaques that accompanied the carpet, among other things. He was a great 3
Slide 20: How to turn your million-dollar idea into a reality asset and highly valued. Having good people around to support you is vital. Although I was initially searching for the timber to make certificates similar to those made by Hartunian, I decided to use some of the timber that I saved to make the frames for a limited number of MCC carpet pieces; that way they would have even greater value and appeal. My neighbour at the time was a former cabinet maker and unlike my father, who also had a shed full of tools collecting cobwebs, John actually used his regularly, so I enlisted his help to cut the timber. The warehouse had already cut the timber into tongue-and-groove–style flooring so it was easy for John to turn some of the timber into the required style for framing. While in the USA I had purchased a huge range of unframed memorabilia, including pictures and signed photos, and I was in the process of having it all framed by a local sports memorabilia framer, Frame-mem. So Dave at Frame-mem became our framer for the initial series. The different editions of the framed carpet initially released, with a football and cricket version and different frame options. With John cutting the timber and Dave making the frames, Bruce and I could spend our time focusing on generating sales and not do any of the construction dirty work. Bruce is an ex-NBL basketball player and seems to know everyone, so we also enlisted the help of one of his contacts who runs Sport the Library (a sports photo library) to get the photos I used in the frames. I paid a royalty for this. I also enlisted couriers to do a lot of the deliveries, again to leverage my time. However, as Bruce worked for himself he 4
Slide 21: From imagination to idea conception did take on the responsibility of delivering a good number of the frames initially. I was still working at The Athlete’s Foot, dealing with shoes and feet, so I wasn’t as free during business hours, but the way I consciously structured the business allowed for most of the work to be done over the phone or after hours, such as the packing of the frames which was done in the rumpus room at Mum’s place. I also decided to donate 10 per cent of every frame sale to a charity. We chose the E.J. Whitten Foundation <www. ejwhittenfoundation.com.au>, which supports prostate cancer research, as I felt it had the best fit with what I was doing. Ted Whitten — a Pete’s tip: former AFL player — was known as share the wealth ‘Mr Football’; he died from prostate Donate a percentage of your cancer in 1995. I initially approached profits to your favourite the E.J. Whitten Foundation because charity. You can help those in I wanted to put some of the profits towards a good cause, but later I need and potentially build your business at the same time. also formed a joint venture with the foundation, which is explained in chapter 16. I created a number of different versions of the frames, to enhance their appeal. The initial release consisted of two styles; one based around cricket and one around footy. The layout of the frames was the same; I simply changed the photos and the wording on the plaque to differentiate between the two. This way I felt I could capture both markets of MCG fans. Each of these styles had two different series; a limited edition of 50 that was framed with authentic MCG timber, and a second series of 500 that had a generic mahogany frame. I made two or three of each series initially, so that I had stock to ship, but did not restrict our cash flow too much or require a large capital investment (more on this in chapter 7). The framer was able to produce the frames within a great turnaround time. This enabled me to sell the frames with a 14-day delivery — enough time to produce extra frames and deliver them on time — thus working on a make-to-order basis, which is very good for cash 5
Slide 22: How to turn your million-dollar idea into a reality flow. I worked out a maximum number of frames for each series, so that they would be limited editions. I also gave away a small piece of green timber, which was taken from the old MCG seating, to add value to the first 50 orders. I then began to think of the best target market to sell to. Obviously I came to the conclusion that MCC/MCG members would be the perfect market, so I arranged a meeting with the MCG. Unfortunately they didn’t like the proposal, and decided not to be involved. However, about three days later the MCG issued a press release announcing that they were going to conduct their own auction of MCC memorabilia and carpet when they began the redevelopment of the MCC Member’s Pavilion at the MCG. I guess I’ll never know if they leveraged my idea. But by using creative marketing ideas, I generated sales off the back of the publicity the MCC created for themselves. To start making sales I wrote a series of press releases, one with the heading ‘21 year old sells MCG for under $500’. I sent these out to every media outlet I could find, and the media onslaught began — Channel 7, the Herald Sun, and 3AK, just to name a few. I received a huge range of free articles plugging my idea and venture, which prompted the initial run of sales. (More on this in chapter 10.) At the same time as my selling the ’G venture was going on I was also involved in a real estate investing ‘challenge’, which was being run by Steve McKnight <www.propertyinvesting.com>. His first book From 0 to 130 Properties in 3.5 Years became a national bestseller, and for his follow-up book he was mentoring a group of budding real estate investors towards the goal of acquiring $1 million of property in one year. I was receiving a reasonable amount of press for this too, which involved a number of positive segments on Today Tonight. All this publicity meant I was starting to be recognised occasionally as the guy who was selling the ’G. The feedback was fantastic — everybody thought it was a great idea. One night I was out in the city catching up with a group of friends from university, and while out at a club a guy recognised me from my various TV appearances. We ended up chatting for a while about what I was 6
Slide 23: From imagination to idea conception up to. I actually walked away at the time a bit disappointed it wasn’t an attractive young female who had seen me on TV — oh well, any publicity is good publicity as they say … At the end of 2004 I moved to Ocean Grove and started using a local framer in Geelong, Kardinia Picture Framers. At the time of writing some of the timber I bought is being kept in a family friend’s garage in Bacchus Marsh. Download: Because I still have some timber Visit <www.preneurmarketing. and carpet that is yet to be sold, the venture is ongoing, and you can see com.au/mcgaudio.php> to what is happening now at <www. download a short audio file sportinglimitededitions.com>. You that gives an overview of may be lucky enough to grab a the selling the ’G venture. frame or a pen if there are any left. I recently had executive-style handcrafted pens created from some of the MCG wood, and through my networks have sold a quantity of these to Crown Casino among others. (More on the power of networks in chapter 15.) I am always looking for new ways to capitalise on the idea and the momentum I have built up. N But can I do it? If you are worried that maybe you are not cut out for this, think again. Anybody can do it. I was not born with these skills, and they certainly don’t run in my family. It takes a little ingenuity and creative thinking, but there is no mystery to it. I didn’t have any top secret information or an unusual technique. To prove that my folks are not business people and that I didn’t inherit this ability, when the basketball card craze was in its early stages in Australia we were in a store in the city, and the owner of the store offered a box of cool new cards to my mum and dad on consignment (sale or return) to resell to my mates back home. Being the non-entrepreneurs that they are (nontrepreneurs?), they couldn’t see the value and the potential of this offer and they knocked it back. Basketball cards later became hugely popular. I 7
Slide 24: How to turn your million-dollar idea into a reality still remind them about that, and the money they lost. So what are you waiting for? There it is — an overview of how I sold the ’G. It’s not rocket science, just a great idea, some hard work and creative thinking. To summarise: I took an idea from overseas and adapted it to the Australian market. I used free publicity to generate sales. I worked on a make-to-order basis to boost cash flow. I created special and limited editions to generate interest. I used my contacts to create opportunities. I leveraged my time by paying others to do some of the work. These are just some of the strategies that will be examined throughout the book, to help you turn your idea into a success story. And anybody can do it, so read on … 8
Slide 25: Chapter 2 From imagination to … fearlessness Our doubts are traitors, and make us lose the good we oft might win by fearing to attempt. William Shakespeare Key points Overcome your fears by redefining failure. Setbacks are merely a step along the path to success. Learn from your mistakes. Overcome a fear of success by getting started. If you are going to be successful with your business ventures, there is one emotion that you must overcome: fear. Everybody experiences fear at some stage when pursuing their goals. It is the inevitable result of leaving the safe path to go in your own direction. Fears can include: What if my idea isn’t good enough? What if I’m not good enough? 9
Slide 26: How to turn your million-dollar idea into a reality What if something goes wrong? What if people don’t like what I’m doing? What if I’m too old? Or too young? What if I go broke? Feeling like this is natural, and even healthy. If you don’t have some concern about what you are doing and an awareness of the possible risks involved, you may be racing into something without Pete’s tip: the proper preparation — and undoubtedly you will go broke. what’s the worst that However, all of these fears are part can happen? of what is really a single, overriding Do you currently work in fear: what if I fail? Fear can prevent a stable, nine-to-five job? you from making a start, or it can Well, the way I see it is that stop you along the way. How do you if you have a go but don’t overcome the fear of failure so that make it, the worst that can happen is you’ll end up back you can achieve your goal? You must prepare yourself now, with a nine-to-five job. As and decide that you won’t let setbacks long as you don’t make any outrageously stupid decisions, or moments of doubt stop you from reaching your target. No matter how you will have spent some great your idea, how hard you work, time and money and ended or how well prepared you are, there up back where you started. will still be moments when you say But at least you tried! to yourself, ‘Gee, it would be a lot easier if I just got a job’. When it seems like there’s a million things to do and most of them needed to be done yesterday, and everything is going wrong, and it is all up to you, it’s only natural to wonder whether you’ve made the right decision, or whether you have failed. Overcoming these moments and conquering your fears are part of the satisfaction that comes with success. 10
Slide 27: From imagination to fearlessness Fear of failure Fear of failure can put an end to the best ideas. In today’s world, being a ‘success’ is very highly regarded. People who have highpaying jobs, big houses and nice cars are generally considered successful. People who tried to start their own business but it didn’t work out are usually considered failures. But you can appear to have all the modern trappings of success and still not be successful, and you can appear by conventional standards to have failed without having really done so. What do you think? I consider people who have the courage to leave the security and comfort of a nine-to-five job and attempt to make it on their own a success. It doesn’t matter whether their idea panned out or not — just trying makes them a success. Trying to make your own way takes guts, imagination, determination, willpower, and effort. How can such a person be considered a failure? Would you rather have the high-paying job and nice car, but spend all your time thinking about your business idea? ‘If only I could leave this high-paying job and start riding a skateboard, I could open up that cafe that cuts your hair while serving you coffee, washing your car, doing your laundry and reading your stars.’ Well, if that’s your business idea — good luck! If your dream is to be an entrepreneur and you are not doing it, the job and the car do not make you a success (even though people might see you as one). There’s no such thing as failure To overcome a fear of failure, you must realise that there really is no such thing as failure. Success and failure are merely perceptions. Something that might look like a failure at the moment is only another step towards your eventual success, or even the success itself. Take the story of the now famous and hugely successful Postit note. The adhesive used in Post-it notes was invented in 1968 by 3M research scientist, Dr Spence Silver. He was attempting to design a strong adhesive, but he actually ‘failed’ and the adhesive he developed was very weak. Dr Silver tried unsuccessfully for five 11
Slide 28: How to turn your million-dollar idea into a reality years to find a use for his new adhesive. Arthur Fry, a new-product development researcher, attended one of Silver’s seminars, and he was intrigued by the strange adhesive. During his spare time Fry sang in a church choir, and it annoyed him that the bookmark in his hymn book would always fall out when he stood up to sing. One day he realised that he had found the perfect use for Dr Silver’s glue — it could be used to make a bookmark! The original Post-it notes were used as bookmarks, and the remainder was shown to the 3M marketing department, but they rejected them as useless (a failure). Fry gave them to his secretary to dispose of, but she instead found what is now the classic use for them. Fry told her to distribute the remaining notes to all the executive secretaries in the 3M offices. When they ran out, she was inundated with calls for more. These calls were passed on to the marketing department, who finally got the idea. Initial prototypes were available in 1977 and by 1981, after a large sampling campaign, the product had been introduced around the world. Everyone now knows of and uses Post-it notes. This is a classic tale of a failure turned into a success. Post-it notes have been developed in a range of colours and designs for a variety of uses, and they can be found in offices, schools and homes all around the world. Nev Bray, from one of Melbourne’s leading building companies, Bray Constructions, tells a story of failing to win a job with a client, but due to the way he conducted himself with the prospect, he can now attribute over $1.5 million worth of work directly to the client and their referrals. So he didn’t get the job he was after, but he did get other work as a result of quoting for this client. I have not failed. I’ve just found 10 000 ways that won’t work. Thomas Edison As an entrepreneur, you are bound to venture into areas that are new to you. How can you not make some mistakes along the way, no matter how well prepared you are and how hard you work? It could even be suggested that if you don’t make the occasional mistake, you are not being adventurous enough in your 12
Slide 29: From imagination to fearlessness business strategy. Taking calculated risks can be part of creating a successful business. The nature of all human advancement, both great and small, is that we learn as much from our mistakes as we do from our successes — probably even more. We wouldn’t be where we are Pete’s tip: today if some great minds before don’t make the same us had given up when they ran mistake twice into problems. Thomas Edison, for Mistakes are inevitable. example, conducted thousands of unsuccessful experiments before Don’t let them get you down, but make sure you learn eventually finding a practical design from them. Then move on. for the light globe. The nature of scientific experiment is that scientists learn from their mistakes, and conduct the next experiment a little differently. This can be done hundreds — or even thousands — of times over, until the experiment is a success. Does this mean the earlier experiments were failures? No, it’s just part of the process. No scientist expects to reach a final outcome after only one experiment. Being an entrepreneur or a business person is no different — when you run into difficulties, fix them, learn from them and move on. Even a complete business collapse can teach valuable lessons for future success. Many successful businesspeople have previously started or run businesses that didn’t do well. Failure is only the opportunity to begin again more intelligently. Henry Ford Some people who don’t know how to fail … Let’s have a look at a few people who refused to accept that they had failed. As a basketball fan, I’m going to start with Michael Jordan. Jordan is today generally considered the best basketball player ever to step onto a court. He won six championships with the Chicago Bulls, five league most valuable player awards, numerous 13
Slide 30: How to turn your million-dollar idea into a reality scoring titles — you name it, he won it. So what’s he doing here? In high school Michael Jordan was cut from the school basketball team. Was he a failure when this happened? Of course not. He just hadn’t reached his goal yet. He later said: ‘Whenever I was working out and got tired and figured I ought to stop, I’d close my eyes and see that list in the locker room without my name on it’. Never give up. Never give up. Never give up. Winston Churchill Australian author Matthew Reilly had his first novel Contest rejected by every major publisher in the country. Undefeated, he decided to publish the book himself. He paid for 1000 copies to be produced, and sold them to bookshops one store at a time. An editor from one of Australia’s major publishers bought one of these copies, and she loved it. She tracked Matthew down and signed him up. Matthew has gone on to be an internationally successful author, with his books on bestseller lists all around the world. Have you read the novel Catch-22 by Joseph Heller? It is a literary classic, and spawned the now-common phrase ‘catch 22’. Why was it called Catch-22? Because it was rejected by 21 publishers. It has now sold millions of copies and was turned into a movie. Imagine if Heller had stopped after receiving the twenty-first rejection letter … Chicken Soup for the Soul is a book of ‘powerful tales of ordinary people doing extraordinary things’. It was rejected by 140 publishers! Even the book’s agent gave up on it. But authors Jack Canfield and Mark Victor Hansen believed in their book, and kept going. They eventually found a publisher, and went on to sell millions of books. Canfield and Hansen are now among the best-selling business authors of all time. When Sylvester Stallone finished writing the screenplay for Rocky, he tried to sell it with himself playing the lead role. He was unknown at the time, and some studios were interested in the film but would not allow Stallone to act in it. But Stallone held out, and eventually went on to play the boxer in the role that launched his career. 14
Slide 31: From imagination to fearlessness One of the greatest presidents in American history had plenty of chances to be considered a failure, but he wouldn’t accept this. Let’s see what happened to him: born into poverty in 1809 failed in business in 1831 ran for the state legislature and lost in 1832 failed in business again in 1833, and lost money that he had borrowed from friends had a nervous breakdown in 1836 was defeated when running for speaker in 1838 was defeated when running for elector in 1840 was defeated running for congress in 1843 and 1848 was defeated running for senate in 1854 and 1858 was defeated running for vice president in 1856. Who was this? Abraham Lincoln. Maybe the fact that he had endured such a hard road to get to the presidency made him so good at the job when he finally got there. These are just a few examples of rejections or setbacks — which could have been perceived as ‘failures’ at the time — leading to outstanding success. There are thousands of these stories, and more are being written every day. Maybe you know somebody like this. Never confuse a single defeat with a final defeat. F Scott Fitzgerald As you can see, overcoming obstacles is a vital ingredient for many successful people from all walks of life. They overcome fears and doubts. They refuse to accept defeat. They instead learn from these events and use them as motivation to keep going until 15
Slide 32: How to turn your million-dollar idea into a reality they reach their goals. This is an attitude you must adopt to be a successful entrepreneur. Overcome your fear. See ‘failure’ for what it is — merely a temporary setback that can lead to greater things. And even if in the end your idea doesn’t work, it doesn’t mean you have failed. Just trying — where many others do not — makes you a success. Along the way you will have learned valuable lessons that can help you in life or with other ventures in the future. Learning from your mistakes Mistakes are an inevitable and valuable part of the process of creating your own business, but to learn from them you must analyse them. When you encounter a temporary setback, ask yourself the following questions: What was the mistake? Why did this occur? Could this have been avoided? If so, how can I avoid this problem next time? What lessons can I learn from this? Find out exactly what went wrong, and why. Don’t blame other people who may have been involved; make it clear that you are just trying to find out what happened so that the problem can be avoided in the future. Take responsibility for the problem, and for fixing it. Discuss the problem with business associates, friends or family. Get some other perspectives and opinions, and find out how other people have handled such problems. Don’t be shy or embarrassed — use it as a learning experience. Think about your mistake and learn from it, then move on. Sally Anderson, a legacy coach, for Legacy Leadership <www.sallyanderson.co.nz>, says lessons are sent to us in three phases; first is a tap on the shoulder, then a piece of 4 × 2 to the back of the head if you didn’t learn the first time, and then if you still haven’t learnt the lesson it’s a Mack truck headed right 16
Slide 33: From imagination to fearlessness at you. You may not learn from your mistakes the first time, but if you don’t eventually learn from them they will appear as a Mack truck. Think you are too young? Or too old? The fear of being too young or too old to become an entrepreneur is not unusual, but there really is no age limit. There are successful entrepreneurs of all ages. I often hear people in their twenties say they will get their idea off the ground when they have ‘settled down’. This amazes me. I actually think it is harder to start after ‘settling down’; there may be kids, a mortgage, two cars to run, and myriad other responsibilities. Why wait until you have taken some, or all, of these on? Most people in their early twenties don’t have these responsibilities, and are therefore better placed to take a chance and try something adventurous. As I proved with the MCG, you don’t necessarily need a lot of money to get started; all you need is a good idea. I was only 21 when we started selling the ’G. Richard Branson has been an Pete’s tip: entrepreneur since he was a teenager. He started a student magazine, then age doesn’t matter moved on to selling records via You are never too young. mail order. Bill Gates left Harvard Or too old. Start today. University in his early twenties to concentrate on Microsoft. Alex Tew is the English guy behind the million dollar homepage <www. milliondollarhomepage.com>. He sold one million pixels on a single web page for US$1.00 each. He was only 21 at the time. Younger people have the advantages of fewer responsibilities, more energy and more free time, and they often have more creative ideas, as people often become more conservative as they grow older. Just as you are never too young, you can never be too old to be an entrepreneur. Colonel Harland Sanders, the famous colonel behind KFC, didn’t start franchising his chicken business until he was 65 years old. KFC is now available in more than 80 countries. 17
Slide 34: How to turn your million-dollar idea into a reality Until his death at the age of 90, the Colonel travelled 250 000 miles a year visiting KFC restaurants around the world. Many older people have the advantage of work and business experience, and are more likely to have money behind them. Retired people also have free time to dedicate to their business idea. Fear of leaving the nine to five Another common fear is leaving the safety of a secure job, where you have people to help you, to start a business, where you must be more self-reliant. When you work for a company, you usually have marketing people to do the marketing, accountants to crunch the numbers, and a tech person to help you when you accidentally change the language on your computer to Swahili. Typically, your profession provides you with skills within one particular field, and this translates to the core idea for starting your business, but you may be worried about your lack of experience in other areas. If you are a plumber and you open your own business, you have the leaky-pipe repairs covered, but what about the marketing, or the tax, or the office management? If you are an accountant, you will be able to keep your own books, but you might not know how to manage staff, run an office or develop a marketing plan. You may be highly skilled in your area, but to run your own business you must also become comfortable with many areas that may be unfamiliar to you. This does not, however, mean that you must become an expert in these aspects of your business. If this is a fear that is holding you back, you must accept that you can’t do everything — seek counsel from others who know more than you do, and leverage other people’s knowledge and experience (as explained in chapter 7). You don’t necessarily need to hire full-time staff to cover skills that you lack. For example, you don’t need an in-house accountant. Just find an accountant who will be at the other end of the phone when you need help, or who will come to see you when you are making a big financial decision. You can hire a bookkeeper who comes in one afternoon a week to take care of the bills and the 18
Slide 35: From imagination to fearlessness invoicing. You don’t need to be a financial expert yourself, you just need to pick up enough so that you can work with the people who are experts. Once your business starts to expand, then you can think about hiring part-time or full-time staff. There are businesses or individuals out there who can cover just about any need that arises: marketing, technical support, bookkeeping, legal advice, transport, storage, sales, administration — the list is almost endless. These people and businesses are experts at what they do, so use this knowledge and experience to your own advantage. Don’t let the fear caused by your lack of experience across a range of fields hold you back. Fear of success Another common fear is the fear of success. Sound strange? Well, this is because the fear of success is often mistaken for a fear of failure, but the two are different. Fear of failure is the fear of things going wrong along the way; fear of success is the fear of encountering problems caused by achieving a goal. Perhaps the biggest of these fears is that people often worry about whether they will be happy once their goal has been achieved. If your aim is to start your own clothing label, thinking about this and planning for it can make you happy, and gives you a goal. Maybe you are dissatisfied in your current job, and enjoy the inspiration of thinking about your business idea. But what happens if you reach this goal, and it isn’t as good as you had hoped? What was an exciting idea becomes a disappointing reality. You’ve left your job, put in the time, money and effort, and you’re still not content. This fear is a fear of success. If you are excited and motivated by an idea, it can be safer to hold on to this rather than risk the outcome not meeting your expectations. Procrastination is the fear of success. People procrastinate because they are afraid of the success that they know will result if they move ahead now … it is much easier to procrastinate and live on the ‘someday I’ll’ philosophy. Denis Waitley — motivational speaker and author 19
Slide 36: How to turn your million-dollar idea into a reality How do you overcome this fear? The answer is very simple: get started! You won’t know until your business is up and running whether it will make you happy, but it most likely will. I’ve seen people have this fear before starting, but I’ve never seen it turn into reality. A very large majority of the entrepreneurs I meet thoroughly enjoy what they do; running their own business is as exciting and challenging as they hoped it would be, and the financial rewards have met or exceeded expectations. Nobody can give you a money-back guarantee that life will be good once your goal is achieved, but I would consider it a very safe bet. You will be working in a field you enjoy, meeting new people, doing new things, and (hopefully) making more money. Who wouldn’t enjoy that? There are, of course, two alternatives. First, don’t start your business. Is this likely to lead to happiness? While it might feel safer just to dream about it, sooner or later this will lead to disappointment and regrets. The other option is that you start it and you don’t enjoy it. The simple solution is that you stop and return to whatever you were doing before. If this happens, you can at least gain satisfaction from having tried, and you won’t spend the rest of your life thinking, ‘If only I had given that a go’. Success also brings responsibility, which people can be afraid of. If you are successful, you will have to run the business, look after the finances, make big decisions, and keep everything moving. You won’t have a manager to check things with, and when there are problems it will be your job to sort them out. Instead of seeing this as something to be afraid of, see it as a challenge. If you have never done these things before, prepare yourself. Read business books. Go to seminars. Find a business mentor. Talk to friends who run their own businesses. Do a short business management course. You must be ready for the responsibility that will fall to you, and accept this as part of the challenge, not something to be afraid of. The fear of change can also be part of the fear of success. If your business takes off, your lifestyle will most likely change. You might have to work longer hours, especially at the beginning, taking you away from your family or other interests. In the short term, you 20
Slide 37: From imagination to fearlessness might have to accept this as part of the price of what you are doing. But, in the long term, if your business does well you should be able to arrange it so that you are not working any longer hours than you did before, and you might even be able to work less. Another bonus is that you might have more flexibility to work when you want, or to work from home. (I believe it is vital to structure your business around your personal goals, as discussed in chapter 4.) Being an entrepreneur rarely involves more interruption to lifestyle than a comparable position working for somebody else. The way to get started is to quit talking and begin doing. Walt Disney 21
Slide 39: Chapter 3 From imagination to … finding your million-dollar idea Ideas are the beginning points of all fortunes. Napoleon Hill Key points Your goal from day one should be to develop a profitable business idea. Don’t just start a business in your area of expertise without exploring the potential market. Being an entrepreneur does not necessarily mean creating something completely new. Adapt an existing product or service, and put your own personal spin on it. Always keep your eyes open for opportunities. Let’s have a look at how you can come up with an idea for your business. This chapter is a ‘choose your own adventure’ style; if you already have a business idea, only some of the information in this chapter might be useful to you. If you just know that you want to be an entrepreneur, but you have not yet developed an idea, read on! You can start with what I call ‘becoming a fisherman’; that 23
Slide 40: How to turn your million-dollar idea into a reality is, get out there and see what the world needs. Find a problem that needs solving. Find a hole in an existing market. Or you can leverage somebody else’s idea — find an existing product or service and think of a way to do it better. Here’s a little story that I really like, and it reflects how you should read this chapter. Over the years psychologists have done many, many studies on the effects of positive and negative attitudes — the difference between optimists and pessimists. One such test they did was on a couple of five-year-old boys, named Billy and Johnny. Billy was a very negative little boy. It didn’t matter what was going on for Billy, it was always bad. He was always moaning and groaning about something. Johnny, on the other hand, was always very positive. Doctors decided to see if the environment would have any effect on their attitudes. So they put the boys into two different rooms and isolated their environments. They took Billy and put him in a room with every conceivable toy a five year old could want. It had trucks and toy guns and water pistols. They left him there to play for an hour with the cool toys. They took Johnny down the hall and put him in another room, and told him to have fun for about an hour and that they would be back to check up on him. Inside this room was nothing but horse manure; however, they shut the door and left him alone. About an hour later the psychologists came back to check on the two little guys. When they checked on Billy they couldn’t believe their eyes. He was sitting in the middle of the room crying his eyes out, with toys thrown all over the place. They asked Billy what the matter was. Billy said, ‘That toy is the wrong colour, that one didn’t make the right sounds, that one isn’t big enough’. According to Billy, every toy had a fault. They left him and went down the hall to check on Johnny. When they opened the door to his room they couldn’t believe what they saw. Here was Johnny, in a room full of horse manure, laughing and flinging the stuff all over the room and having a ball. They said to Johnny, ‘What are you doing?’ ‘I’m having a ball like you told me to.’ said Johnny. 24
Slide 41: From imagination to finding your million-dollar idea ‘But you’re in a room full of manure — how can you have fun?’ Johnny replied, ‘With all this, there must be a pony in here someplace.’ That’s how I want you to read this chapter — have fun and dig around until you find what you need. And if you learn something from Johnny, it will also be a great help to you in your business venture and life — always look on the bright side. No matter what problems you are faced with, look through the manure and find the pony — it’s got to be there someplace! You’ve got to look for a gap, where competitors in a market have grown lazy and lost contact with the readers or the viewers. Rupert Murdoch Profitable ideas In his book The Boron Letters, Gary Halbert writes about one of his lessons on selling. He asks his students, ‘If you and I both owned a hamburger stand and we were in a contest to sell the most hamburgers, what advantages would you most like to have on your side?’ The answers are predictable — the best meat, the best location, the lowest prices. Gary tells his students they can have all these advantages, but the only advantage he wants will ensure that he whips the pants off them. What does he want? A starving crowd. Become a fisherman If you are looking for a new idea to start a business, ask yourself this simple question: what product or service will give me a starving crowd? Your aim as an entrepreneur should be to develop a product or service that people want. Success and profits will come much more easily if you leverage an existing demand, rather than try to sell something that people aren’t interested in. You must go fishing where the fish are. Develop a product for profitability. The best way to develop a venture is to find a market with money that has an unfilled need, then create a product or 25
Slide 42: How to turn your million-dollar idea into a reality service that fills that need. One of my favourite examples is also incredibly simple — the hammer. You wouldn’t give this tool a second thought today, but imagine what a revolution it was when it was invented. Consider how much easier it became to join two pieces of wood together or to hang a picture on a wall. These are the specific uses that a hammer is designed for. Without these a hammer is useless, and it came about because somebody asked, ‘What would be an easier way to hang a picture on a wall?’ What can you come up with that fills a specific need? I never perfected an invention that I did not think about in terms of the service it might give others … I find out what the world needs, then I proceed to invent. Thomas Edison The internet is a very powerful resource for budding entrepreneurs, both for ideas and as a business tool. You can use the internet to run your business from home or in your spare time, especially when you are starting out. Using the internet also means that you Pete’s tip: develop a have access to a global marketplace profitable business idea without leaving your computer. And the internet is also a great way to Too many people start a business simply based on an check the demand and size of your potential marketplace. I call this interest or skill they have, going fishing — you are trying to without investigating the find out where potential customers potential. You should focus are biting. on developing a profitable So how do you do this? It’s very business idea. If you have simple. Everybody is familiar with an area of interest, find a particular niche in this field using internet search engines — such as Google or Yahoo — to find that will make you stand something on the net, but you can out. This will increase your also use these as a tool to find out profitability. what other people — your potential customers — are searching for. Most search engines keep track of the terms people use to search, and how often each term appears. This information is freely available, and you can use it to gauge 26
Slide 43: From imagination to finding your million-dollar idea the level of interest (often from all over the world) in an idea you have. A useful site for this is Yahoo Search Marketing <searchmarketing.yahoo.com>. Simply use the ‘Keyword assistant’ function, which is free of charge, on this site to find out what people are searching for. For example, for the purpose of writing this book I entered ‘sport memorabilia’ into the keyword tool and received the following results: Table 3.1: searches in June 2006 Search term Sport memorabilia Collectible memorabilia sport Card memorabilia sport Buy memorabilia sport Sport memorabilia store Sport memorabilia Australia Celebration memorabilia sport Auction memorabilia sport Box car match memorabilia sport Anthony memorabilia Mundine sport Wide World of Sport memorabilia Autographed sport memorabilia Value sport memorabilia Matheson memorabilia New Phil sport Zealand Australia memorabilia payment plan sport Australian sport memorabilia Authentic memorabilia sport Yahoo! Search Marketing Keyword Assistant Count 1126 295 221 54 32 19 13 12 12 10 10 8 8 7 6 6 6 27
Slide 44: How to turn your million-dollar idea into a reality This table lists how many times these terms have been searched for on this site in a month. If you are thinking of starting up some sort of memorabilia enterprise, you can instantly see that there is a lot of interest in cards. Are you thinking about starting a photography business? Let’s see what happens: Table 3.2: searches in June 2006 Search Photographer Wedding photographer Become a photographer Famous photographer Brisbane photographer Wedding photographer Gold Coast Wedding photographer Sydney Wedding photographer Brisbane Melbourne wedding photographer Count 1782 1172 304 302 290 275 268 260 243 Yahoo! Search Marketing Keyword Assistant Interesting! You can see that weddings might be the way to go. Here’s a few other results from random topics I tried: When I entered ‘dog wash’, three of the top seven entries included the word ‘mobile’. People obviously expect to have their puppy groomer come to them. When I tried the word ‘mattress’ (I have no idea why), three of the top seven entries were about care or cleaning. Maybe you can invent a great new way to clean a mattress? Are you a handyperson? When I entered ‘renovation’, ‘bathroom renovation’ was second on the list, and ‘kitchen renovation’ was fifth. 28
Slide 45: From imagination to finding your million-dollar idea Thinking of selling fishing products and you need an area to specialise in? ‘Fly fishing’ appeared in five of the top ten searches that included ‘fishing’. When I tried ‘smoking’, the second entry was ‘quit’ (with a score of 3035), and ‘stop’ was third (with 1019). There’s obviously a lot of people out there wanting to kick the habit. Do you have an idea that will help them? You can see how this simple keyword search can give you useful information and point you in the direction of what your potential customers are looking for. I consider these keyword tools ‘fish finders’. It’s not a substitute for detailed market research, but it will help to point you in the right direction when you are trying to come up with, or refine, an idea. Ebay also has a great feature that can help with this, called eBay Pulse <pulse.ebay.com.au>. This will provide you with up-to-theminute details of what people are searching for, how much people are bidding, what items are most ‘watched’, and what categories are most popular. Use this as an added fish finder tool. You can use this information to Workbook: come up with a new idea, invention Try this keyword search or way of doing things. Find out with five different business what people want, and tailor your areas that interest you. business around this. It’s not always a Write down the results in good idea to simply copy businesses your From Imagination to that are already out there. If you Implementation Workbook, do just copy the common ways of and comment on the results. doing things, how will you make yourself stand out? Another useful tool that some search sites have is a facility that allows you to see what current advertisers are willing to pay for a particular search term. Advertisers have to submit bids for keywords, with a higher bid ensuring a more prominent position on a site. If advertisers are willing to pay a high price for a keyword, it’s usually a good sign 29 J
Slide 46: How to turn your million-dollar idea into a reality that this particular word is often used in a search, and is therefore potentially a good market. It is usually free to access this service, just to check the bids. (For more information on this, have a look at chapter 13.) You might also check out some internet chatrooms to see what people are talking about (no, I don’t mean ‘hotdate.net.au’). There are all sorts of chatrooms available on the net. If you are thinking of starting an accounting business, you are sure to find a chatroom or newsgroup where people talk about tax issues. Log in and see what’s going on. What are people talking about? What are people complaining about? What common problems do they have? Do they all think the price of having a tax return completed by a professional is unreasonable? Does poor service seem to be a common complaint? Or errors? Keep in mind that if you see a problem appear, say, 100 times in a newsgroup, you can be sure that there are many more people out there with the same problem. The internet is a cheap (often free), easily accessible goldmine of information. When you are developing your idea, make sure you are going fishing where the fish are biting. Stack the odds in your favour. This will make it much easier to get your business off the ground, and will make you much more profitable. Don’t make it an uphill battle. You must know there is (or will be) a market that is big enough to keep you afloat. If you are starting a retail business it must be in a location that has buyers. If you create a virtual office that will operate from home or on the net you could have a world market, but make sure there is a market need that you are filling. The #1 mistake most businesses make is not having a market size that meets their earnings needs. Mark Victor Hansen Success with new ideas Let’s see how some people have become successful through their new idea. Henry Ford was the first person to build factories based around 30
Slide 47: From imagination to finding your million-dollar idea assembly lines, with conveyor belts to move materials. Because of the highly efficient production techniques, in 1916 Ford made over 700 000 Model Ts, which was twice the output of all their competitors combined. This allowed Ford to sell cars much more cheaply than their competitors, and the price of a new Model T actually decreased over the years. Today Ford is a leading international car maker, and the techniques created by Henry Ford are still being used. Bette Nesmith Graham invented liquid paper (originally called Mistake Out) in 1951. She was a secretary who had an interest in art, and she thought that if artists could paint over their mistakes, why couldn’t typists? She found some paint that was the same colour as the stationery she used, and mixed it with some water. She put this in a bottle, and used a watercolour brush to paint over her mistakes. Soon the invention spread around the office, and — realising the potential — Graham started a parttime business from home selling Mistake Out. She later changed the name to Liquid Paper, and began working in the business full-time. Today liquid paper can be bought all over the world. There are thousands — maybe even millions — of stories like these. Will people be talking about your great invention one day? Use the fish-finding techniques to find out what people want or need, and come up with an idea or invention that will fill that gap. Just creating something new will not guarantee success, you must create something new that people need and will pay money for. Building on other people’s ideas Starting a business does not necessarily mean creating a new technology, coming up with something radical that has never been done before or inventing a new product or service from scratch. This is a common misconception. Many would-be entrepreneurs spend years trying to come up with an earth-shattering idea, when there are opportunities all around them, every day. Many of the most successful business people all over the world have simply adapted an existing idea, implemented an existing product or service in their own way, or improved on somebody else’s 31
Slide 48: How to turn your million-dollar idea into a reality creation. Here’s a few of the most successful businesspeople and entrepreneurs of our time, from Australia and around the world: Bill Gates, Richard Branson, Janine Allis, Ben Cohen and Jerry Greenfield, Donald Trump, Anita Roddick, Sam Walton, Rupert Murdoch, John Ilhan and Ray Kroc. All of these people started multi-million-dollar businesses and have become icons in their industries. How many of them invented a new idea, or created a new product? None — not a single one of them. We’ll have a look at some of these people later in this chapter, though I’m sure you recognise at least some of the names. And there are thousands more people who have built their success based on other people’s ideas. Good ideas are common — what’s uncommon are people who’ll work hard enough to bring them about. Ashleigh Brilliant — English author As you’ve already seen, my idea for selling the ’G was based on Paul Hartunian’s idea of selling the Brooklyn Bridge. It wasn’t my concept to begin with, but as soon as I read about it I thought, ‘How Pete’s tip: ideas are can I do that in Australia?’ It just commodities took a bit of searching to find the Ideas are commodities; right opportunity. I made the idea it’s the execution and my own by applying it to the MCG implementation that makes and doing it my own way. the true difference in life and Let’s have a look at some people business. who have been very successful using this approach, and then see how you can put it to use. Success without re-inventing the wheel Perhaps one of the greatest examples of leveraging an existing idea is that of Bill Gates and Microsoft. Gates has become one of the richest people in the world (his personal fortune is measured in the billions) based on somebody else’s idea. That’s right, the product 32
Slide 49: From imagination to finding your million-dollar idea that started it all for Bill — called DOS, which stands for disk operating system — was not Bill’s invention. In 1980, IBM was building the first commercially viable personal computer, and they needed an operating system to run it. They approached Microsoft, who agreed to supply the software — the design for which they bought from Seattle Computer Products for around $50 000. There were several different computer companies and operating systems in the early days, but Microsoft and IBM went on to dominate the industry worldwide, thanks in a large part to DOS, which was the best operating system at the time. Years later, Bill gates borrowed another idea from Apple computers. Microsoft launched a new operating system called Windows, which used an icon-based system and a mouse instead of text commands to run a computer. Apple had been doing this for years, but it was a revolution for Microsoft users. Coca-Cola started in the same way. Coke was invented by Dr John Pemberton in Atlanta in 1886. He made efforts to promote the drink, but it did not take off. During the first year, he sold an average of just nine drinks per day. He later sold the rights to the drink to businessman Asa Candler. By 1892, Candler’s flair for marketing had boosted sales nearly tenfold. Today Coca-Cola operates in over 200 countries and has nearly 400 brands. While travelling, Janine Allis recognised that Australia suffered from a lack of healthy fast-food alternatives. She often had trouble finding something healthy to eat or drink when she was in a hurry. She thought the American juice bar trend could be brought to Australia. When she came home, she developed a business plan and raised $250 000 through friends who were willing to invest in her idea. She consulted nutritionists and naturopaths to come up with natural, healthy juice recipes. In 2000, the first Boost Juice Bar opened in Adelaide and since then over 170 stores have opened throughout Australia and New Zealand. Janine found a great idea overseas, and successfully implemented it in Australia. Richard Branson has never invented anything in his business career. He has run a record label and an airline, opened music stores, released a brand of cola, and now offers financial services, among other ventures. None of these are new ideas. So why has he been so 33
Slide 50: How to turn your million-dollar idea into a reality successful? Perhaps more than any other businessperson, Branson demonstrates what can be done with a bit of imagination, a lot of marketing and putting your own personality into your business. His company name — Virgin — attracts attention instantly and he is a shameless promoter, using sometimes outrageous publicity stunts to attract attention to his brand. He appeared in a wedding dress to open his bridal store, and he drove a tank down Fifth Avenue in New York to introduce Virgin Cola in America. Across all his products, the thing he is selling most is his brand, Virgin. He also likes to move into areas where he believes the existing companies are providing poor service, and give the industry a shake-up. This is one of the reasons he started his airline and mobile phone businesses. I want Virgin to be as well known around the world as Coca-Cola. Richard Branson Australian John Ilhan has made his fortune selling mobile phones. There’s nothing new about mobiles, but there was something new about the way John went about it. The name Crazy John’s came about through John’s crazy marketing ideas, which included being the first to sell a mobile phone for $1 and holding midnight barbecues for customers, while his competitors were still charging $200 for phones. By applying his own personality to selling a common product in an extremely competitive market, John has expanded from a single store in 1991 to over 100 stores today. Jim Penman started Jim’s Mowing in 1982 with a second-hand lawn mower and a trailer. Today he has over 2300 franchisees in three countries, and Jim’s is one of the largest home-service franchises in the world. He didn’t create a new business idea, he just improved on an existing one, with his focus on customer service. In 1948, brothers Richard and Maurice McDonald opened their hamburger restaurant in San Bernardino, California. Its success was based on its limited menu and rapid service. But are the McDonald brothers responsible for McDonald’s dominating the fast food market around the world? No, that honour goes to Ray 34
Slide 51: From imagination to finding your million-dollar idea Kroc, who sold milkshake mixers. Ray heard about the McDonald’s hamburger store, and how it ran eight milkshake mixers at a time. He jumped in his car and went to investigate. When he arrived, the store was doing a roaring trade, and Ray had never seen customers served so quickly. He immediately saw the potential of the store’s unique methods, and suggested to the brothers that they should open up more restaurants. When they asked him who could do that for them, he replied, ‘What about me?’ Ray opened the second McDonald’s restaurant in Illinois in 1955. There are now more than 30 000 McDonald’s restaurants in 119 countries around the world — all thanks to Ray! McDonald’s later added another innovation to the fast food world — the drive thru. This was an idea that had first been used by banks throughout the USA, with ‘drive thru’ access to tellers. Here’s another successful adaptation of an existing idea. FedEx is the largest express courier company in the world. It didn’t invent postage or courier services, but it changed the way it was done. On its website, FedEx notes the following ‘firsts’ that it has achieved. They were the first courier company dedicated to overnight delivery and delivery by 10.30am the following day. They introduced Saturday deliveries and time-definite services, and were also the first to provide money-back guarantees and free proof of performance. Frederick Smith, the founder of FedEx, didn’t invent a new product or service, he just found a better way to provide an existing service. The company began operating in 1973, with the launch of 14 small aircraft from Memphis International Airport. On its first night, Federal Express delivered 186 packages to 25 American cities. FedEx has grown into a worldwide, $29-billion network of companies, offering transportation, e-commerce and business services. (The story around the campfire is that Frederick Smith wrote an essay based on the FedEx business model while at university — and was given an F!) Dell Computers is the largest personal computer manufacturer in the world. But Michael Dell certainly did not invent the PC, he just came up with a better way to sell it. Dell started out working in his college dorm room, with just $1000 and the idea of providing 35
Slide 52: How to turn your million-dollar idea into a reality affordable computers to college students. His business is now based on direct sales — there’s no retailer between the company and its customers, allowing Dell to keep its costs down. Today Dell has annual revenue of over US$40 billion. Some of the largest and most successful companies in the world Pete’s tip: make it you were started either by buying somebody else’s idea or simply Think about it — everyone creating a better way of doing has had the same million dollar idea as someone else. something. There is nothing wrong with this — it is a common approach The one who banks that million dollars is the one who to business, and as you can see from these examples, it can be an implements and executes. extremely profitable one. It is my strong belief that ideas are commodities. A car is a commodity, a microwave oven is a commodity, a mobile phone is a commodity and an idea is a commodity. It is there to be developed and used, and it can be bought and sold. If you see an idea that is not being used to its full potential that you think you can do better with, or an idea that may already be successful but you can adapt for your own purposes, then do it! You don’t have to re-invent the wheel. Don’t take it to the extreme of course; you can’t simply copy somebody else’s idea. What I’m talking about is adapting or leveraging an existing good idea and making it your own. You can’t open a juice bar and call it Boooost but you can look at how Boost was started and apply it to, say, opening a bakery. You can’t open a mobile phone store and call it Crazy Jan’s, but you could study what John Ilhan has done and, for example, apply these ideas to an online mobile phone store, or to a different product all together. Adapting an idea As we saw with John Ilhan and Richard Branson, injecting your own personality and methods into a business can be a great road to success. If you have strong marketing skills, these can be useful in any business. But you might also have a particular skill that can be applied to a certain product or service. You might, for example, 36
Slide 53: From imagination to finding your million-dollar idea have a secret recipe for spectacular pizzas. Pizza delivery places are everywhere, but maybe your recipe will give you an edge. Or maybe you are a mechanic with an interest in a certain type of classic car. Perhaps you could start a mobile business based on this, specialising in cars that your typical mobile mechanic would not be able to handle. Adapt and modify things that are already out there. What special skills or talents do you possess? Can you cut hair a better way? Service a car a better way? Paint a house a better way? There are always different and better ways to do things, no matter what it is. If existing businesses had every corner of the market covered, there would not be room for people like Richard Branson, Janine Allis, John Ilhan and Michael Dell to make their fortunes. They saw a hole in the market and they moved to fill it, either by adapting a product or selling an existing product or service in a better way. A fax machine is nothing but a waffle iron with a phone attached. Grampa Simpson Buying an idea You might find an opportunity if you see somebody else trying to run a business or sell a product or service but not doing a very good job of it. Just look at what happened with Coca-Cola and Microsoft. Does your next-door neighbour have a great idea for an internet-based business, but she doesn’t seem to be doing anything about it? Or maybe one of your colleagues has an idea for a mail order cosmetics business, but doesn’t have the skills to put it in place. Perhaps the nursery down the road is really good but its marketing isn’t. People have good business ideas every day but don’t do anything with them, or implement them poorly. This doesn’t make the idea bad, just the execution. Just like anything else, ideas can be bought and sold. Always keep an eye out for potential opportunities. You never know where you might find a great idea. If you come across a product or service that has unfulfilled potential, see if you can get onboard, or take it over. 37
Slide 54: How to turn your million-dollar idea into a reality For more on constructing joint ventures, be sure to check out chapter 16. A long, long time ago … Okay, so it’s not really business related, but I had to include the example of Star Wars. George Lucas’s groundbreaking movie was inspired by a Japanese film called The Hidden Fortress, which is a story about a princess fleeing through enemy territory, escorted by a brave warrior and two squabbling friends. The similarities to Star Wars are obvious; a central part of the film is the rescue of the princess from the evil empire, and the hero is accompanied by two bickering robots, C-3P0 and R2-D2. Still no idea? If you are really stuck for an idea, have a look at network marketing (also known as multi-level marketing). Network marketing is when you are given products to sell for a company and receive payment for this, and you also attract other people to the business. When these people sign up and start selling the products as well, you also receive a payment for the sales they make, on top of your own sales. You can see where the term ‘network marketing’ comes from. This type of business gives you the opportunity to leverage off someone else’s model and still create your own business or second income, often part-time. Using an existing business idea that has already been tested and has proved successful is a great way to get started and learn sales, business and marketing skills. It’s a great stepping stone to your own venture. The biggest advantage of network marketing is obvious: you will receive an income from the work of others without having to hire them as employees. Other advantages of network marketing are: You can start in your spare time, and build it to a full-time job if you wish. 38
Slide 55: From imagination to finding your million-dollar idea It usually doesn’t require a large amount of capital to get started. You can work from home, and control the hours you work. You have the marketing support of the network marketing company you are working with. Probably the most well-known network marketing company is Amway. Others are Nutrimetics, Avon and Goji juice, and there are many more out there. If this interests you, type ‘network marketing’ into a Workbook: search engine and see what comes If you are interested in up, and then contact the companies network marketing or for more information. franchising, perform an Another way to leverage an existing business is to buy a franchise. internet search and find three different companies that This can involve significant capital outlay, but you will be buying a interest you. Write down the tested business model and the strengths and weaknesses of support of the company you buy each in the appropriate place the franchise from while still owning in your From Imagination to your own business. There are many Implementation Workbook, and then pick the one you different types of businesses that can be bought as franchises, including think is best for you. Explain your reasoning. fast food outlets, shoe stores, bookstores, lawn mowing services and car washing services. J Most successful entrepreneurs get their ideas for their businesses by studying niche markets and then developing a product or service that meets their needs or solves common problems. Corey Rudl — author of The Insider Secrets to Marketing your Business on the Internet 39