Business Models & Business Markets That Make Millions

On this video, I'm going to share with you two of the most important factors that are absolutely essential. If you're serious, not just curious about becoming a millionaire, I'm going to share with you the business models and the business markets that make millionaires, as well as the business models and the business markets that don't. Because all markets are not created equally and all business models are not created equally. And if you pick the wrong model and, or the wrong market, you are going to engage in a struggle fest the likes of which you will not be very happy about. So what are these business models? I'm going to write them on the board just so, just so like, you can follow my thinking. Hopefully I'll be able to follow my thinking. So, so as we're, as we're looking at, as we're looking at markets and models, I'm going to cover the business markets first because I think one of the biggest mistakes people make when they start a business is they start their business in here. This is something I know how to do, so this is the business I'm going to start. This is something I love, so this is the business I'm going to start. This is something I've always wanted to do, so this is the business I'm going to start. Instead of starting your business out there, if you start your business in here, there's a 50, 50 chance that at best that you'll strike gold. If you say, well, this is just something I know how to do, right? But if that's something you know how to do is not something that solves a problem for other people, then it doesn't matter that that's all you know how to do. People think that wealth is a lot of money. I believe that wealth is your and my ability, our ability to create value for someone other than ourselves. I want you to think about that like any, anybody who's wealthy, any business that's produced a lot of wealth, they've done it because they've been able to create value for a large number of people other than themselves. And because you're the one starting the business and you're starting the business because you want to make more money. Unfortunately, when you start the business, the person you're thinking about is you. And then when you're creating stuff, you're thinking about you. And then when you go talk to the people about the stuff you created, you're thinking about you. And therefore, you don't have the ability to create wealth because you created all solutions for yourself and none for Anybody else. And so you're hoping that you'll create wealth by going, going out and using the market to solve your problems. It just doesn't work that way. That's like unplugging something, unplugging a lamp to make the light turn on. It doesn't work. It's backwards. And so if you're serious about creating wealth, you have to pick the right market. Now, there are three different markets we're going to talk about.

I'm going to do it like this, and I'm going to do it like this, and I'm going to do it like that. And so the first market is the worst market. And this is the market that a lot of people, when they get started in, even if they don't get started in this market, they think about whatever market they got started in from this perspective, and it cost you a fortune. And that is a.

Commodity market. Now, what's a commodity market? A commodity market is a market where the product only has intrinsic.

Value.

What is intrinsic value? Intrinsic value means it's utilitarian value.

It's like a box of nails. It's like a box of screws. It's like.

A broom, a dustpan, a mop, right?

The value is that you can use this thing to do that thing, right? If you go into the commodity market, they only have an intrinsic or utilitarian value. Then the other things about that is because it only has an intrinsic value, you can only, you can only be competitive in the marketplace via price.

Right? And so what happens is, let's say you sell nails, and your nails that you sell in your hardware store are.

$5 a box. So you sell your nails for $5. But your competitor, who has a hardware store down the street across the street, he walks past your window, he sees your nails are $5. So he sells so these are your nails. And then your competitor sells his goes to his were $5.10. He goes and he sells his nails. Now he lowers his price to $4.90, and then you see his nails on your way to somewhere else. And then you lower your nails to $4.80. And then he lowers his to 4, 7. He lowers his.

$4.80, and then he lowers his to 470. And so what happens is you get in a race.

With price. You get in a race to the bottom for the person who can have the lowest price. There is no competitive advantage whatsoever to being the second lowest price.

There's no competitive advantage. And so if you win, you lose. And if you lose you lose. Why? Because you chose the wrong race to be in. You're in a commodity market. Because when you are in a commodity market, your competitor sets your price.

Unless you figure out how to make a self driving nail where all you have to do is put it on a spot and it drives itself, you're probably not going to outpace. They're just going to. People are going to buy nails from the people, the businesses that are the closest to them that have a reasonable price. So we don't want to build our business based on a commodity market. Then.

We have mass markets.

And some mass markets products are, they have an intuitive value. But the most important thing about mass market products is they are priced based on cost of goods. How much did it cost me to make it? So this is why I don't want to just sell a product that's mass marketed. Like if I were going to sell a mass market product, I wouldn't sell just a general mass market product. Let's say I'm going to sell cars. I wouldn't just sell cars because a car is a car is a car is a car. If I'm going to sell houses, I wouldn't just sell houses because a house is a house, a house is a house. I would have to have something other than the intrinsic value and the cost of goods. So what they do is they say, okay, it cost me X amount of dollars to make this. I'm going to mark it up 15%, I'm going to mark it up 30% and then I'm going to go to the marketplace with that as the price. So if that's the way you build your business, so you're stuck like chucking a pickup truck because now the people who sell you the raw materials to make your products determine your price.

Okay, let me ask you a question. If you started a business, if you started a business and you go out and you borrow money to start that business and then you hire people who took the risk to start that business. Everybody say I did. That's right, you did. So you took the risk to start that business, but somebody else set your prices. How does that make sense?

It doesn't. Not only does it not make sense, it doesn't make any sense at all. So, and there's like, what can you do to enhance this? Well, you can do some things in mass market to enhance the price, but not by, not by a significant enough margin. So something as essential as food, right. Food's fairly essential. Right. Do you know what the margins on grocery stores are.

How small is small?

No, no, not 5%, not 10%. Like 2 to 3%. They make 2 to 3 cents on every dollar for the food that they sell.

Sell something. It's mind blowing. So cost of goods. This is not fun.

Both of these are stress and headache city.

This is the only arena in which I want to play. This is the only market in which I Want to play. PVMs. Premium value market. What is a premium value market? A premium value market. Now, the price is set by the perceived.

Perceived value.

And the intrinsic value and the cost of goods doesn't even come into play. It doesn't matter. So it's like my book.

All right, Keenan, edit that part out. Okay, cool. It's like my book from Boss Mose. This is a paperback book. It has 172 pages. If I were in the commodity market, I was just selling a book, I might be able to get away with selling this for 1695. Right? Why? Because that's how much paperback books sell for, like, at the most. Right. If. If I were in the mass market, it cost me about $5. Again, I might be able to sell it for $16.95 because of how much it cost me to make. Actually, it cost me about $3 to make, so. Or I could sell it or how much people in the market sell paperback books for? You go to Barnes and Noble. You're not going to find one. If you do, I'll be shocked. 172 page paperback book for.

The amount of money. You won't find one that I sell this book for. You won't even come close. Right. So this book sells for $30 plus shipping, and the shipping is $9.99 domestically and it's $25 internationally. So somebody literally who lives overseas, when they buy this book, they pay $55 to get this book. Why? Because this book doesn't fit here. And it doesn't fit here. It fits there. It's a premium value. Like, it's a premium value offer for a book. So.

On the Internet, when people sell books, they have this concept. You've probably bought books this way, but you didn't know it was like. This is a marketing strategy. It's called free plus shipping offer. Okay, has anybody not heard of free plus shipping offer? Okay, all of you have heard of it. Okay, so you give the book away for free and you only charge shipping. But then as soon as they say, I'll take the book and pay for the shipping, you offer them something else that enhances the book experience. Then you Offer them something else that enhances that experience. And by the time you get done, you start out paying $7.95 for shipping and handling, but by the time you check out, you've got $125 in your book card. That is a viable strategy, just not the one I chose to use. And because the. And the reason I didn't choose it is because I don't like building businesses based on analogy. I like building businesses based on first principles. And so the first question to me, the first question when it comes to first principles about anything, is, what is the objective? Right? And as I shared with you all this morning, the most important thing you can do with regard to selling anything is to build a personal brand. Well, what's a brand? A brand is a name that reminds you of a story.

So what is the story people tell themselves when they hear your name? That's the question, right? That's the question that we want to have in our mind when we're creating. Okay, what's the story I want people to think of when they hear my name? So everybody was modeling. Russell Brunson makes sense. He's brilliant, right? He's a brilliant marketer. He's doing the free plus shipping offer on his book. So everybody starts doing free plus shipping offers, and they're giving away thousands and thousands of books, and they're doing upsells and upsells and upsells. And then I come along and I say, well, I'm gonna sell my book for $30 and $9.99 shipping and handling. So I had a guy who eventually bought one of my coaching programs. He said, when I saw your book for sale for $30 and $9.99 shipping and handling, he said, I was so mad. And he didn't say mad. He said, I was so mad. How does he think he is? How can he charge this much money for this book? He said, then I read the sales funnel, and it said, I charge $40,000 an hour for coaching. And if you read that book, like, if you hired me to coach you, whatever I tell you in the first two hours is the stuff in this book. He said, once I saw that, I was like, oh, that makes sense. And then he bought the book. But he didn't just buy the book. He bought the upsell to the challenge. And then he bought the coaching program at the end of the challenge. Why? Because I had a frame. I gave him a frame through which to view my offer. That made it make sense to him to say yes to that offer. Are Y' all tracking, right? And see, one of your problems is as an entrepreneur, you don't have any pre framing. You know what's really fascinating to me? People when they look at other people doing something that they don't understand.

And it doesn't make sense to them, their only conclusion is that it's a scam.

So anything that you don't understand, somebody, there's somebody out there who wants to make money off of you to tell you it's a scam. Like a lot of people say multi level marketing is a scam. Now I'm not like, I'm not a fan of multi level marketing. For me, I don't participate in multi level marketing, but I still think it's a great business model. I think it's a great business model. I think any entrepreneur who wants to build a business would do well to have their first business be a network marketing business where they have to build a team, they have to learn how to sell and they have to learn how to recruit and they have to learn how to lead people who don't have to follow them because you will develop so many skills. Now I know a lot of people are going to say, there he goes, promoting multi level marketing. I'm not promoting it. I'm just saying I believe it's as viable a business model as a real estate agency. It's as viable a business model as an insurance agency. But most of the people don't make any money. Most of the people, most things don't make any money. Right. But the reality is you will learn skills that are absolutely essential. One of the reasons I'm so good at sales, one of the reasons I'm so good at marketing is because I was so terrible at it when I got started in network marketing, selling insurance and investments. And I was terrible. How long until I got good? Okay, so you are tracking. So these are the markets that create millionaires. Now let's look at the business models. Okay, I'm going to do it like I like to do my different levels. Okay. So the lowest, the lowest of all of the business models is what I call a wantrepreneur. In fact, I'm not even going to do it that way. I'm going to do it this way. I'm going to do LV.

Times LP equals wantrepreneur. So LV times lp, what is that? Low volume times low price. So you have something that you sell, let's say you sell it for $20. Let's say you sell two of them a Month. You think you have a business, but you want to be an entrepreneur. You're a want entrepreneur. You're not a real entrepreneur. Why? Because you have low volume and low price, low profits. So you can do.

HV times LP and that. You know what? I should have done the other one first. I'll just leave it like this. This equals what I call a waltrepreneur.

A Waltrepreneur? Yes. What is that? That is like Sam Walton. What did he do? Sam Walton said I never want to make more than 3 30% margin on anything I sell. He said if I go buy something in bulk and I get a discount from my vendors, I'm going to pass that discount onto my customers. And Sam Walton became the richest man in the world with the Walterpreneur business model. Low volume. I mean high volume, low price. That's a really viable business. There are a lot of people who do that today. In what business? E commerce. Low profit, high volume. They sell plastic forks or whatever and they sell millions of them and they make a lot of money. Okay, I saw this thing, I was watching this shark tank episode last night on YouTube and these people created this thing called bucket golf. And they created this backyard game with these oversized golf clubs, these oversized golf balls and these pop up basket bucket things with a flag in it. And they sell it for $299. And the first year when they first created they only did like $5,000. And then the next year they did.

2 million. And the next year they did like 5 million. The next year they did like $12 million in sales. All E Commerce, $200. Relatively low price. And then, but high, crazy high volume. Then you have.

Lv, LV times hp. This is what I call the entrepreneur business model. What is entrepreneur business model? Low volume, low volume times times high price. High profit equals entrepreneur. So when I first got started I was an entrepreneur. Like when I first got started coaching in the coaching space, I was coaching people on how to sell and in particular I was coaching people in network marketing. Whole bunch of different network marketing companies because I got good at that. I got to the place where I was making $40,000 a month. So I was teaching other people. How do you build an organization where you can make like significant money in network marketing or multi level marketing. So I had a program that I sold for $497. And I would go and speak to these organizations. These companies would have me come in and I'd do a presentation and I might have.

Like 20, 30, 40 50, 100 people buy my $497 program. Well, if 100 people buy your $497 program in a month, that's $50,000. That's low volume. 100 people, that's really low volume. But because it's 497, I was able to make a significant income. Does that make sense? And then my favorite business model is the one that I participate in now. I mean, I do some of this and I do some of that. I stay as far away from this as I can. And this is what I call oops.

HV times hp. That's high volume. High volume times high price equals what I call wealth. Wealth tripreneur.

Wealth tripreneur. What is that? That's when you sell something that cost $55,000 and you have hundreds of people who buy it from you. That's when you sell something that costs $27,000. You have hundreds of people to buy that from you. Or you sell something that's.

You sell something that's $375,000 and you have dozens of people buy that from you. And you just.

So all of those price points between high volume, high price, all those price points between 25,000 and a million dollars, we've sold hundreds and hundreds and hundreds of those. We've only had four people buy the million dollar offer, but still it's one of those high price. And if you start down at 25,000, that's a whole lot of people. We're talking about hundreds and hundreds of people who bought stuff from us between 25,000 and a million dollars.

Those are the business markets. These are the business models that if you will stick with them, they will make you a millionaire. Now here's the mistake people make. I'm going to go sit back over here. Here's a mistake people make.

They start their business and they don't take into consideration at all. What is the model? What's my business model going to be? And they don't take into consideration at all. What market am I going to go into to serve? You missed the whole point.

When I used to serve people in network marketing, my coaching programs were $497. Now that I serve high level entrepreneurs, we have doctors, we have attorneys, we have real estate agents, we have insurance, like insurance brokerage owners. We have people from all walks of life who are high net worth, high income individuals. Now I'm serving a different market. So the market that I serve, the premium value market, supports the wealthtrepreneur business model to at and here's the beauty of it. For those of you who are contemplating whether or not you should go into the wealthtrepreneur business model.

Very few people ever step into that arena because they think it's so, so hard. And I'm going to let them keep believing that. So I hope this video helps you stay blessed by the best. And we'll see you on the next video. Bye for now.