Millionaire MBA – Get The Millionaire Mindset

I’ve just finished reading an excellent book by entrepreneur Eric Ries called, The Lean Startup.

This is a very detailed follow-up book to the equally excellent ’4 Steps to Epiphany’ by entrepreneur, investor and university professor Steve Blank (Eric Ries was a pupil in Steve Blanks entrepreneurship class).

Both books talk about the concept of ‘Lean Startup’ – an approach to starting (mostly tech) companies which aims to reduce the chances of failure… or more precisely, reduce the chance of building a product/service which customers do not want.

Here’s my three main takeaways from Eric’s book:

1. A new business idea is just an hypothesis until it is proven.
Ries (and Blank in his earlier book) make the point that a new business is simply a bunch of assumptions until they are proven to be true. Entrepreneurs are by nature optimists and believe wholeheartedly in their ideas, but often this belief borders on delusion. As an entrepreneur, you can have all the passion, belief and determination to make your company successful, but in reality, at the early (pre-customer) stage, all your business is, is a bunch of unproven ideas — which you believe will work. In reality, the proof only comes when customers part with their hard earned cash, and pay you for your product and services.

2. Build only a minimum viable product to test your assumptions
Ries and Blank talk a lot about building a ‘minimum viable product’. The world of startups is littered with well built products which no body wants. Millions (if not billions) have been squandered on the assumption of ‘build it and they will come’. For most of the time, this just isn’t the case — hence a the over populated graveyard of business failures. By building only a ‘minimum viable product’ which you can use to present your ideas to prospective customers, you can soon start to get customer feedback and start to see if your ideas and assumptions are valid. They key here is ‘learning’ and understanding what the market actually wants, rather than blinding building a product nobody wants.

3. Innovate and pivot until you get it right.
My third takeaway is about the ‘pivot’. A pivot is a change of direct for the business based on lesson learnt and feedback from customer and the wider market. If something is not working, then change it. In the book, Ries suggests that often the reason a company is not working has less to do with the product or its feature set, but more to do with the needs and wants of customers. He cites examples of companies who first built one product which customers did not want, but after a fast pivot, they were able to change direction and align themselves to the true customers desires. Paypal is one of these examples… a company which first started out as a bill payment system for Palm Pilots.

This is a great video which shows human behaviour. They key is for entrepreneurs and marketers is to understand customer psychology and how to tap into customers needs and wants.

I recently helped a successful entrepreneur write a book about his company.

In the book, we outlined 52 factors which made his business the success it is today.

If you are a prospective client for this company, you could’t help but be impressed in how professional, customers focused, innovative and forward thinking it is.

I spent a lot of time with this entrepreneur bouncing around ideas for content for the book.

One line in particular sticks in my mind which is this. ‘Selling is easy… the hardest part is finding something that people want’.

This is such an important line, I will repeat it: ‘Selling is easy… the hardest part is finding something that people want’.

Given that this particular entrepreneur is what I would call a master salesman, this came as a great insight to me.

Perhaps it shouldn’t of, as when you think about it, it is clearly easier to sell something people want than no.

But in the world of marketing, and especially the ‘big-promise marketing gurus’, they would have you believe you can sell anything to anybody — especially if you use their new fandango marketing method.

This simply isn’t the case.

First and foremost, there has to be market for your product and services, and prospective customers have to want what you sell.

For sure, great marketing can help make a product more attractive and enticing, but essentially, their must be a want there by your target audience.

A great example of this is my new Bromtpon folding bike which I have just paid £800 for, not an insignificant amount of money.

I’d had in my mind for sometime that I wanted to get a folding bike. In fact, I’m in the process of converting my garage into another office and storage space for bikes is now limited. My children’s bikes are getting bigger, so it is time for mine to get smaller.

If you know the folding bike market, you’ll know you can buy half decent folding bike for around £200. Given that I rarely ride my old mountain bike, a £200 folding bike should have been more than sufficient for me. But the point is, I didn’t want one… not when I had seen the rolls royce of folding bikes, the Brompton.

In reality, I don’t need a Brompton!

The fact the the Bromtpon folds smaller than all other folding bikes is great, but I could have got by with a Dahon at half the price, or even a lower price unbranded bike at £200. But my emotional want and desire was so great with Brompton, that my decision making was made from my heart, and justified with my head.  Now having bought my Arctic Blue S3R Brompton, I can tell you endless logical reasons why I needed this bike, but in really, I quickly became emotionally attached to the bike and just plain old wanted one.

Brompton have a fantastic british made product in their bikes, but they are also master marketers and have created a whole culture around the bike so that you feel part of an exclusive club. When you see fellow Brompton riders, you have a knowing respect for them an their machine.

To add to the eccentricity of Brompton, the company hosts an annual Brompton races around Blenheim Palace, where 750 racers wear suits, ties and short trousers and race around the grounds of the palace. Similar Brompton races occur around the worlds in Japan, Mexico, US.

Imagine now being the marketer behind Dahon, Birdy or Bike Friday, three companies who offer quality folding bikes which would meet the needs of any self respecting cyclist. The trouble is, if a prospective customer has set their heart on a Brompton and wants one, then no amount of marketing, or possibly even price discounting is going to make them switch to a different brand.

Such is the power of having a want.

Thankfully not all folding bike purchases think the same way as me or have the same desires as me and there is still a sizable market for other folding bike manufacturers who tap into the wants of another group of customers.

Question from Millionaire Upgrade reader: What are the most important traits you need to succeed as an entrepreneur?

Thee are many things you need to succeed as an entrepreneur, but a good way to consider what it takes to succeed are four factors spoken about in day 5 of Millionaire MBA – a day about failure. When you look at why most entrepreneurs fail, you can soon see what they need to succeed.

In day 5 we speak about the 4Ms of failures (of the 4Ms of success!). These are:

Mindset, Marketing, Money and Management.

MINDSET: At the heart of all successful entrepreneurs is an entrepreneurial mindset. This is a different way of thinking to most employees. It’s a mindset which is filled with passion, belief, desire, ambition, tenacity and courage.

No entrepreneur ever succeeds without first passionately believing in themselves and their product service.

MARKETING: To start with, you need a winning business idea which you can market! Without an idea for a product or service which customers emotionally want or need, you will forever struggle as an entrepreneur. Getting good at the WHO, WHAT, WHY, WERE, HOW and WHEN of marketing is essential. A good line to keep in mind is that ‘coming up with ideas is easy… selling is hard!’.

MONEY: Typically you need some money to start a business. It is no impossible to do with zero capital, but more difficult. Even if you do not need much capital to start your new business, you will need money to tide you over until revenues come through. Marketing also is something you need money for. Marketing can be expensive… not all marketing and customer acquisition campaigns work and there can be a lot of wastage in marketing. Prepare for that and have sufficient funds to get your message out to the right people. Keep in mind that many start-ups fail because 1. they cannot find enough customers and 2. They are undercapitalised.

MANAGEMENT: As your business moves forward and you hire people (either freelance or permeant), you need to become a strong manager and leader. You need to get good at communicating your vision and the direction of the company, and get good at delegating. you cannot do everything yourself, and you need to learn to let go and trust others. More often than not, other people will be better that you… give them the chance and let them shine.

Question from a Millionaire Upgrade Reader: Which opportunity should I choose?

Choosing the right opportunity is one of the critical ‘make or break factors’ for any entrepreneur. In creating Millionaire MBA, I interviewed Sir Tom Hunter, who had sold his business for in excess of £350m all before he was 40.

He said this about choosing the right opportunity.

“Well, first of all, you’ve got to be able to spot the opportunity because I’ve known people who have worked as hard as me, who were smarter than me, who put in more hours than me, but they chose the wrong opportunity, and, therefore, never made as much money. Therefore, you’ve got to be clever enough to spot the correct opportunity.

Entrepreneurs see an opportunity every day of the week, but I say, “What is the correct one?” because there is a big opportunity cost.

If you choose this, it means you can’t do that. Therefore, is this the right one? Being able to work that out is key. Then once you have spotted the right opportunity, then, yes, determination, focus, build a team.

But I guess the key thing is the opportunity.“

What you consider to be the right opportunity, might not be the same as what your customers consider to be the right opportunity for them.

Just because you are passionate about your idea, does not mean to say your prospective customers are.

As an entrepreneur you need to make sure you are selling something people either want, or have a desperate need for. These are much easier (and less expensive) things to sell.

You also need to get good at marketing, and make sure you understand the six wise old men of marketing… these are WHO, WHAT, WHY, WHERE, HOW AND WHEN.

Or in other words:

• Who is your customer
• What is your message
• Why would prospective customers buy from you
• Where are your customers
• How will you reach them
• When will you communicate with them.

Have a good answer for each of these, and you’ll go a long way to choosing the right opportunity.

Mobile phones and tablets are changing the way we consume information each day, hour and minute.

Smartphones from Apple, Andriod and Blackberry have opened up massive new channels for content creators. In fact, in just six months, close to 100,000 people have downloaded sample versions of Millionaire MBA, or read Millionaire Upgarade on their smartphone — with many going on to purchase the full business mentoring programme.

Today is another step forward in mobile publishing as we release a free Millionaire MBA eBook on the Apple iBooks platform.

This free eBook is called ‘37 Winning Tips and Strategies from Self-Made Millionaire Entrepreneurs‘ and you can download it from: http://itunes.apple.com/gb/book/37-winning-tips-strategies/id452875787?mt=11&ls=1

Watch out in the coming weeks as the first 20 modules of Millionaire MBA are made available as downloadable (paid) ebooks.

Question from a Millionaire Upgrade Reader: How do I stay focused on my objective and not get distracted by SO many things to do?

This is an excellent question and one which introduces the subject of focus.

Having laser-bean focus is one of the traits of self-made millionaire entrepreneurs. That’s because successful entrepreneurs know what their goals and objectives are, and are always working towards them.

When you know what your ultimate objective is, it is easier to make decisions and prioritise your workload to get you close to your goals.

You’ll hear in Millionaire MBA a section from the serial entrepreneur Chris Gorman. Chris made £35m before he was 35, so he knows what he is talking about!

Chris’s advice is to always have your main goal and top 3 priorities written down. These are the big things which take you closer to your goals. When you find yourself questioning what you should be working on, you can always refer to this short list.

You can ask yourself, is this task taking me closer to my goal, or distracting me. Should somebody else be doing it instead of me?

Entrepreneurs are renowned for their lack of focus and ambitious plans. Many even have many companies. But the most successful ones I have met have had a single minded focus on their core business. They know what they are good at (and what they are not good at), and they spend their time playing to their strengths, and delegating their weaknesses.

This is easier said than done when you are just starting out, and have nobody to delegate to, but wherever possible, focus on your strengths and getting others to do the things you are not good at will serve you well.

Question from a Millionaire Upgrade Reader: I want to start my own business but I just can’t figure out how or where to break into business. Any tips?

I’m a great fan of Formula 1 racing, and for a driver to win the F1 Championship, he needs what is known as a ‘championship winning car’.

This is not just a race winning car (i.e. a car which is capable of winning the occasional race), but it’s a car which is capable of winning the whole 19 race championship.

Sebastian Vettel has one at the moment, Jensen Button had one a few years ago with the Brawn, and Mclaren and Ferrari have had one for years.

The same is true in business, you need a ‘winning business idea’ which is capable of delivering the results you want.

Finding a winning business idea is easier said than done, and you may not have one at your first attempt of starting a business. For many entrepreneurs it is business number 2, 3, 4 or even 5 which is their winning business idea.

The key is to have a business of some degree, just to get started and to learn from.

If you have never sold anything to your own customers before (and never marketed and tried to find new customers), you need to start.

It doesn’t really matter what you sell (as long as you have some degree of passion for it), and ideally you will not risk any major capital, but it is important that you are ‘in the game’.

It is easier to find a ‘winning business idea’ once you are already ‘in the game’, as new opportunities present themselves, and you learn more about your own strengths and weakness, and what you have a chance of succeeding at.

You also learn how difficult and expensive marketing can be, and how challenging ‘customer acquisition’ is!