How To Turn $600 into $16 Million

The year was 2013. I was feeling in transition. I had gone through a breakup, and I was kind of itching to change things up a bit in my life. I had tried my hand at several businesses and none of them were really giving fruit at the time. So I put everything that I owned into my Kia Sportage and I drove to Austin, Texas, which is the place where I still live today. When I arrived here, one of the first things that I did was dive into a business idea that I was sitting on that cost about $600 to start. That business idea was to start a sports nutrition company that sold pre workouts and creatine powders and other supplements for people who were active and specifically adding muscle. And I took $600 and I bought 100 units of our first product, which was one of our pre workouts, and we listed them for sale on Amazon. Four years later, that company sold for about a $16 million valuation and made millions of dollars in profits along the way. In this video, I'm going to break down the things that allowed me to turn $600 into $16 million. And over the last seven or eight years, I've not only documented my experience as an entrepreneur, but I have taught the model to hundreds of entrepreneurs. In fact, one of my students last week, we were at dinner with a group of us and one of them that I've worked with his entire journey, his entire career, when he was starting with, like, nothing, he just got an offer to sell his business for many millions of dollars. So there have been countless success stories of people who have built up businesses that were very. Prof. Profitable and very successful. And so in this video, I'm going to recap how we turn $600 into $16 million and share with you some of the things that you can start to work into your business ideas that help it get off the ground and put it in a position to win.

So the first thing that I want to go into is in those early stages of building this business, you know, we had one product, one product idea was a pre workout supplement. But we were never a pre workout supplement company. And this is where a lot of entrepreneurs get confused and lost in the sauce. They will think of what product they sell instead of who their customer is or what type of business that they want to build. For example, if we had been a pre workout company, then we would have come out with a new flavor or we would have come out with a different type of pre workout and would have been trying to sell six or seven pre workouts and that's all that we ever could have sold. I give the same advice to people who are thinking about starting food companies. I say don't start a keto company. Start a company that serves people who are eating low carb or low sugar. And in that way it might be the exact same products, but you're serving a person rather than putting all of your attention on the product. When you focus on selling a product, you tend to overanalyze and tend to question whether or not it's a good product idea. Whereas if you're serving a person, you always got product ideas. So our business was made for people who were working out. It wasn't a pre workout company. It was made for people who were working out. And so that gave us the flexibility to launch. At one point we had 16 products specifically for that one person. The way that I like to describe this is if you can think of a person who is starting a new point in their journey, like they're just starting to lose weight, or they're starting to get into yoga, or they're starting a new hobby, or they've become a parent, or they're going on a journey to become an entrepreneur. If you can speak to someone at that beginning stage of the journey, then you can think of several products that you might sell to them. So for us, what does somebody buy when they're starting to add muscle? They buy pre workouts, they buy creatine, they buy protein. They might buy a nitric oxide or a mass gainer. And this served as the foundation of the types of products that we released in our brand. And that's exactly what you should think about when you are starting a business. Here's some math that'll really give you a lot of clarity. Four products that sell 25 sales a day is 100 sales a day. And at a $30 price point, that's $3,000 a day in sales. And $3,000 a day times 365 days a year is a million dollar business. It's actually about $1.1 million. That's all it takes to have a seven figure business. Four products times 25 sales a day at a $30 price point. And the best way to get four products that sell 25 sales a day is to have one person in mind that buys multiple products. I remember speaking to a mentor of mine when I was just taking like one or two sales a day in our business. He said, what's your goal on this? I said, a hundred sales a day. He said, why a hundred sales a Day I said, because that would be a million dollar business. And we started building for that specifically. So if you go into this journey with that in mind, with that is your intent, then you'll have a very clear person that you can serve for the entire lifespan of them being a customer of yours. And they'll buy multiple products, which will make it much easier for you to hit the first million. That's the biggest lesson that I could give somebody, and it's the biggest shift in my mindset, because as soon as we had that target of a million dollars, we set it as a hundred thousand dollars a month in sales. As soon as we had that target, we started working towards that target with laser focus. And that helped us get into the seven figures very quickly.

So that formula and that strategy took us to the first million. And getting to the first million is really a milestone. It changes your brain, it changes your thinking. Thinking. It makes you realize, I can do this. It's one of the reasons why I talk so much about getting to the first million. Because if you have those four products that sell 25 sales a day at a $30 price point, someone's life has totally changed and they think about business differently. But after that, the focus became a little bit different. Going from 1 to 5 is a little bit different than going from 0 to 1. The transition to go from 1 million to $5 million looks a lot like leadership more than it is about the right ideas. At that point, it becomes about, can you bring on other people who can help the business grow, can create partnerships with people that can make it easier for the business to scale. We started creating advertising relationships with influencers and other places that we would sponsor. In order to get the word out, we sponsored a big bodybuilding event. We created relationships with people who would help share our products with their audiences. We hired employees, and at the time, these are all new things for us. We were guessing just like everybody else. And there's this tug between growth and profitability, because sometimes those two things are at odds with one another. And so those are the challenges that you navigate once you're past that first million. But here's the secret. If you can navigate those pieces of the journey, that's what will take you to the level that most entrepreneurs are not able to get to. If you're willing to go through that sucky period where it now costs a lot more money to grow and it's a lot more stressful to keep the wheels going on the business you got in this, you're like, I run A million dollar business. I should be happier, I should be excited, I should be. I should be waking up every day enjoying my freedom. And then you realize that you've got this baby that has grown up that requires you to take care of it, and it's moving really fast. And now you've got to hire on help and manage all these things. But if you can get through that period, and a lot of entrepreneurs don't, then you've built an asset, you've built a business, you've built this thing that you can scale or sell, which is ultimately what we did. So we built this little team, we built our systems and our processes. And the thing that helped us grow during that time the most was getting good at one specific set of sales strategies. Our sales strategies were to build email lists to sell on Amazon.com we did lots of other things. We built long sales pages, we were in a thousand retail stores, we sponsored influencers, we sponsored podcasts. And none of those things worked for us the way that we thought they would. But the things that we focus on, the things that we were good at, the things that were working well, when we doubled down on them, they did better. So we got really good at selling on Amazon. Not because we wanted to be Amazon marketers or to sell on FBA like you see so many people on YouTube talking about, but because that was our primary strategy for acquiring new customers that would come into our ecosystem, that we would treat well, that would come back and be repeat buyers. That was the nucleus of our strategy. The better we got at connecting with people via email, the more they came back and bought over and over again. Try as we might, we could never become Instagram influencers, which at the time, there was this other company that was a competitor of ours. They were blowing up because they were great at Instagram marketing. That wasn't our game. At the same time, that company tried to sell on Amazon and they got ripped to shreds because their products were terrible. So some entrepreneurs have a skillset that allows them to get ahead of everybody else and they don't double down on that because they see everybody else pursuing this strategy and this strategy and this strategy. Fortunately for us, we just didn't have the time to be that distracted. Although we tried. We did try a lot of different things, but so many entrepreneurs are chasing so many different opportunities that they never get really good at one thing. I told kind of an analogy to somebody recently where I realized I was scatterbrained in a lot of different things that I was trying and I said, I realize now that there's a time in your life where you plant seeds, but at some point something sprouts. And what most people do is say, this is sprouting. I got to get all the other seeds to sprout. In reality, your focus should go, this one is sprouting. I'm going to water this plant, I'm going to take care of this plant, and eventually that becomes a tree that bears fruit. And what happens? The fruit falls off the tree. And now you don't need to plant any more trees. The seeds are now planting themselves. So for us, we got really good at Amazon marketing and building email lists, and those two things together created the company that then grew to multimillion dollars. And you know what happened at that point? Because we were so good at Amazon, Then retail stores started calling us, whereas until then, we had been calling all them, asking them to put us in their stores. But when we mastered one thing, everything else became easier. So the faster you can identify something that's working even a little bit, get good at it, the faster you'll grow. A quick aside on this. When I was in college, I paid for college and graduated with $100,000 in the bank because I got good at this skill that was new at the time called search engine optimization. And I had a few little tiny sites that I had ranking in Google that made passive income, if such a thing exists. I was making sales on these tiny websites. And as a result of that little skill that was unknown at the time, I was able to do extremely well. For somebody who was in their early 20s, I didn't know all of these other things about business. I didn't know about hiring employees, and I didn't have any. I got good at one little thing that made me enough money to be able to allow me to have financial freedom at a very young age. So if you can laser in on something that's working, water that plant until it becomes a tree, that tree will bear fruit, and you'll never have to plant seeds again.

Once we were in the mid seven figures and even high seven figures and again only doing a core set of things, then we had an asset that was producing several million dollars in profit. And we were able to sell that to a private equity group that bought us and paid us a multiple of profit. And that is how it became $16 million, plus all the profits that we earned along the way. And the interesting thing about that experience is when you realize that there are all kinds of people who want to buy businesses, and you See that when you build a company that's profitable and successful, you're the hot girl at the dance. Everybody wants to do business with the entrepreneur who's doing well. Everybody wants to buy the company that's profitable. Everybody wants to be a part of things that are growing. So if you're willing to go through that period of getting through the hard stuff, you now have the asset that everybody else wants. So I used to think that I would have this business that I could sell and make a ton of money and I'd be so grateful to that person for buying my business. And now I realize that we were the ones who built the asset that the other person wanted. And there is a lack of great business ideas and lack of entrepreneurs who are willing to do that kind of work to build something that special. So if you cultivate the mindset of a long term vision, if you cast a vision for a company that serves customers that want to come back over and over and over again, if you launch products that serve that core group of people, the result of that is that you stand out among all of the noise. Customers want to prefer you rather than you trying to beg for their business. And people who want to buy your business want to write you a really big check. That's when you really stand out. I want to tell you this because it's so common, especially among Internet entrepreneurs, to look at what other people are doing and model their success and borrow from what you've learned from them. When in reality, the things that become the most valuable are the most unique. And it's cool to get ideas and mindsets and habits from people who are really successful. But when it comes to serving your customers and developing products and creating winning marketing campaigns, that is unique to who your customer is and how you serve them. And because we were able to do that, we were able to build a company that was valuable enough to sell and turn $600 into $16 million. Now, what about you? If I was standing in your shoes at the beginning of your journey, I would tell you to cast long term visions at least three years out for you to pick a customer and a product line that you really enjoy building and selling. And if you can do that for three years without looking at the score, you'll be ahead of everybody else who tries to compete with you. The second thing that I think you should know is that you're never building an Amazon business, or a Shopify business, or a YouTube business, or a Facebook business. You're just building a business that serves customers. And sometimes Those customers prefer seeing your content on YouTube or they prefer buying on Amazon. But you're not building a business for the platform. You're building a business for the customer. This is one of the biggest mistakes that I see entrepreneurs make. They focus on the platform where they're getting attention or sales, rather than the customer that is behind that activity. But algorithms and platforms are all optimized to serve people. So you can forget about the platform and focus on the people. The results will show up when you put your focus on the people behind the purchase. And the third thing that you should know at the beginning of your journey is that this is a people business. Every customer, every follower, every order that comes through has the potential to be five recommendations or the introduction to the person that radically changes your life. I once called one of our customers because I saw that they were ordering multiple times, and I asked him why he bought our products. And he just glowed with enthusiasm for the products that we were selling. And I know that he told multiple people about our products. And I realized in that moment that if we could go all in on every customer, that they would bring more people with them. At one point, I thought one of our products had plateaued at about 25 sales a day. But as we continued to stoke the fire and go all in on our customers and get more referrals, the sales continued to climb until it was doing over 200 sales per day. So we thought that it had capped out. It hadn't at all because more and more people started referring it to other people. The power of you going all in on the people in your business, the customers rather than the platform or the strategy, you is what will set you apart from everybody else. And if you do that, you'll realize that even if you've only got a few hundred dollars, if you can use that to get one sale, a few customers, and you go all in on them, that will take you very far. Everybody starts at zero. Everybody who is successful has a great story about how they started with nothing. So if you're rubbing two nickels together, if you're wondering, what kind of business am I going to start, if you're looking at people like me and you feel like they're so far ahead of you that you'll never catch up, that means that you're right on pace. Everybody starts in that position, comparing themselves, wondering how they're going to get there, wondering if their business is even a good idea, thinking about quitting, wanting more, desiring freedom. That's where it starts. At some level, I'M envious of the people who had that kind of fire and they haven't experienced yet because you only get that taste of success one time. It's still fun and exciting as you grow, but those early stages are some of the most fun experiences of your life. That's why we empower entrepreneurs to build businesses and invest the profits. That's the strategy that can radically change your life. If you want some help, we have some resources here on the channel. Hit the darn subscribe button. And if you want to go deeper, go to capitalism.comstart to download our free resources. I'd love to hear what your journey as an entrepreneur looks like and where you're going next, so introduce yourself in the comments. Thanks for watching this video. I'm Ryan Daniel Moran with capitalism.com I'll see you on the next video.