MBA1073 Guest Teacher: Jeet Banerjee- How To Find Out Fast If Your Business Idea Will Succeed

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Hey O welcome to the $100 MBA show delivering practical business lessons on a silver platter every single day with our daily 10 minute business lessons for the real world. I'm your host, your coach, your teacher Omar Zenholm. I'm also the co founder of the Hundred Dollar mba, a complete business training and community online and today's episode is a guest teacher episode. On our Guest Teacher episodes I invite an expert to teach their area of expertise. Today's guest teacher is Jeet Banerjee and he'll be teaching you how to find out if your business idea will succeed fast. G has a ton of experience when it comes to this because he's been building businesses since he was 17. He's a serial entrepreneur, a TEDx speaker, a marketing consultant and a best selling author. He he's gonna give you examples from his own experiences, how to know when you have an idea that you should pursue and when to know it's time to dump this idea and move on. Also later on the episode I'll be sharing on a little free gift he's gonna be passing on to all of you. We got a lot to cover so let's get into it. Let's get down to business. One of the most crucial things every entrepreneur will have to do is knowing when they have a good idea on their hands. An idea that's worth implementing and seeing through. It's so important to know that, that the marketplace that other people want to buy your product or service. And it's not just you who thinks that this idea is wonderful. You can't be the only customer. It's also really important to find out if this idea is worth pursuing early on before you start investing a ton of money and time and resources, you want to only double down on ideas that will work. So in today's guest teacher lesson, Jeep Banerjee is going to share with you how he has done this in the past. How, how he's done this with his other businesses. When he succeeded, when he's failed. I'll also be sharing my takeaways and my take on this topic at the end of the lesson. But for now, I'm gonna pass it on to Jeet so he can share with you his expertise. Take it away, Jeet.

Hey, everybody. Jeet Banerjee here. And today I'm gonna be teaching you guys how to find out whether or not your business idea is going to succeed or not. And the most important thing and the biggest lesson I think I'm gonna share from this is how to fail fast. And I think this is a very important concept that many entrepreneurs struggle with, especially newer entrepreneurs. I think many take a very long time before figuring out whether or not a business will work or not. Some end up taking years. And that's a lot of valuable time that you may spend on an idea that never has the roots or the successful formula behind it to be successful. So I'm going to share with you guys my personal strategy of how I figure out whether business ideas will work or not very quickly. To give you guys a little bit bit of a background, I've launched over 10 businesses myself. I've sold two companies for profit, grown some well beyond my imagination. And also I've had my fair share of failures along the way. So I kind of bring both perspectives to the table. And pretty much when I first started out as an entrepreneur about eight years ago now, one of the first things I learned early on was that I had a ton of business ideas and concepts that I wanted to pursue. And I think this is very natural for entrepreneurs because we as entrepreneurs, we just think of all these ideas and all these things that we want to do. And the biggest thing that I learned was an idea that I necessarily thought was great, didn't always mean that other people thought it was amazing as well. Others didn't necessarily feel the same way about an idea like I did. And the biggest thing that I tell people is that just because you love your idea and your mom loves your idea, doesn't mean that the rest of the market in the world is going to feel the same way. So it would be extremely foolish to build out a massive platform, let's say spending tens of thousands of dollars and investing hundreds, if not thousands of hours on a concept without really having any proof or anything, called validation, something I love to use. So the biggest thing that I learned early on that really shaped my process of building businesses comes from this Jay Z quote, actually. And Jay Z said it best when he says that men lie, women lie, but numbers don't. And I found this to be extremely true. Because if you don't get the numbers, data and statistics to back your concepts and to really support your ideas, you really, at the core base of it, have nothing. And I think the numbers, data and statistics are the fundamental elements that every business needs to have supporting them to be successful long term. So I really want to share with you guys the four step process that I use to figure out whether a business idea is going to succeed or not, and whether if it's not going to succeed, how to just really fail fast. So how to really shortcut the process of failing quickly. And so I want to start off by sharing with you guys a real life example of a company that I launched myself. And I'm going to go through the four step process that we used. And this company was called StatFuse. And pretty much what we did with StatFuse was we had this concept of creating a web application that would help high school students get into college. So this was a problem that I had dealt with myself when graduating from high school and going through a college application process. So we decided to create this web platform that would calculate a student's odds of admissions to various universities and pretty much serve as a virtual counselor. Now this one happened to be a success story because we ended up going through this process of building this business completely from scratch when it was just a piece of an idea that was in our imagination. And it was an amazing process that we took and we ended up validating our idea and it ended up being a massive success. It's one of my favorite stories to share because we really grew this company to over 250,000 users and ended up selling the company for a profit without ever spending any money on marketing, which I think was really awesome. So the first thing that you have to do when you begin your journey of figuring out whether a business idea is going to work or not is you got to begin the surveying process. So pretty much when it comes to the surveying process, you want to go out and you want to talk to real life people that you think would be a customer. So reaching out to these individuals sitting down in person. And I always prefer having these conversations in person just because the value and the insight that you get is much deeper than if you print out an online survey or mail some out, whatever the case is. So pretty much with any company and with my company, Stat Fuse, we had to first identify and figure out, okay, who's our target audience, who's the ideal person to use this software. So we wanted to get as specific as we possibly could. And for us, it was either the junior, the high school junior that's going to senior year and getting ready for college applications or or the senior that has just started their senior year of high school and they see that college applications are right across the horizon. So lucky for us, we had just graduated high school and we had some good relationships with students and teachers and the principals at our existing high school. So my partner and I went one day after school and we just started walking around and serving as many of the junior and senior high school students that we could. So we came up with a list of questions and we just kind of wanted to know what they thought of our concept. One and two, if they thought if it was something that they would use, and three, what feedback they would give for us. So it's as simple as going out, approaching these individuals and asking them, hey, we have this concept. We want to calculate a student's chances of admissions and kind of see whether or not it's a good idea. And so we went around asking all these high school students. Immediately the responses were overwhelming. Like, yes, that's awesome, I would totally use it, or how can I use this right away? Then the second thing we went around and asked them was like, hey, do you have any other feedback or anything else that you would want? And from there, students gave us a bunch of ideas. They told us things like, oh, you guys should add scholarships for students, or you guys should tell us how we can better position ourselves to a university, or you guys can help us with the college essays. So we went around and we did all these surveys and we got really good feedback. But again, that was just what men and women told us, right? So men and women, like I said earlier in the very beginning, they can just lie. They can just be nice and say the right things to you to not hurt your feelings. So then it came down to step two, which was creating a minimum viable product. And I like to call this an mvp. And what a minimum viable product really is is figuring out what the core value of your idea is and building the most simple version of it. So for our idea, the most simple version of it was creating this college chances calculator and really doing it for only 20 schools. So we took the 20 most popular schools that were the most applied to and we created this algorithm that would calculate the students chances of getting into these universities, right? So we had like the top schools, like the Ivy Leagues, like Harvard, Stanford, Yale, Princeton and some of the UCs, like UC Berkeley, USC, UCLA. And so we put all this stuff together, we spent a few months doing it, and we just created the most basic version of our product because now we have to take this product and we have to figure out if people are being serious about it and are actually going to use it. So then we came down to step three, which was validation. So we built this very basic, very minimum viable product, the mvp. And then we went back to the high school students and we asked them, hey, we've got this program, it's completely free. Can you guys go through and use this and tell us how you feel? Right. So this came down to the validation process. So initially we would have them use the product, we would watch them as they use the product and, and really see how they interacted with it and what their thoughts were. Some students came out and said, this is amazing, I love it just the way it is. Other students said, well, everything is a multiple choice option. And I felt like I was in band and I want an orchestra performance and I had all these outlier things that you guys didn't take into consideration and I didn't get to share. How is that going to positively or negatively impact my chances, right? So we had to go through and we had to validate many things to our audience and make improvements, right? So we took all this information that the students gave us. Some students told us, well, how do I know that this is accurate, right? I want proof that it's accurate. So that was another thing we wrote down in the validation process. Like, hey, before we go live with this and launch, we need to go out and really figure out a way to prove that this works. So our idea for that was take all the students that have already graduated high school, take their report cards, plug that data back in and see how accurate we are, and kind of use that as a case study. So that's kind of what constituted this whole validation process. And we spent a few months collecting all this information. And the biggest thing that I tell people during the validation process is ask people to pay you for your product. If people are willing to pay you for your product, that means you're onto something and that means that there's some demand for it. But if people aren't willing to take out their wallets and pay for something, that's when it comes down to that Jay Z quote that I mentioned that men lie, women lie, but the numbers don't. They're telling you all these things, but they're not willing to pay for it. And they're your ideal audience, which is a red flag. And last but not least, the fourth and final step is the reiteration process. So now you go through and you collect all this feedback and you got all this data and you got all this information and insight. And now you figure out, okay, how can I improve my existing product to make it one that is going to be appealing to my audience? So you go in and you make the changes. You ask yourself what makes sense, what doesn't make sense. And step three and step four is just a back and forth process. So you go in there and you make the changes. Then you go back and you approach the students. For example, which we did, we went back to, students, had them use it again and they said, oh cool, we really like XYZ improvements, but we don't like blah blah, blah. So then we go back and we reiterate again and it's just kind of like a recycling process, right? Get the feedback, go back, make the changes and do that. And pretty much after the final reiteration process, we had a product that almost every high school student unanimously said, we love this. And that's when we really built it out, launched it to the public and were able to achieve all this success. And pretty much through this four step process, you guys are going to be able to quickly figure out whether your idea is a hit or a miss. Sometimes you may be missing on your idea initially, but through the reiteration process and collecting the data, you guys will find that secret sauce that really works. There'll be some other times where you'll hit your idea right off the bat and you'll be good to go. And then there will be the unfortunate circumstance where there'll be some times where your idea, no matter how many iterations you go through and what you do just will not take off. And that's when you realize after a certain time period that hey, this idea isn't the best one, we've got to move on and we've got to try something else. But that's it for this section and this lecture, guys. Hope you guys enjoyed. Thanks so much.

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Thank you Jeep Energy for that great lesson and sharing your experiences with our audience. I want to share one thing that I find will be very, very helpful and in this process of idea validation, number one, ideas don't have to be one of a kind. Unique, never heard of super innovative. You just need a unique selling proposition. Let's say, for example, you want to open a pizzeria. You might think, oh, pizzeria, that's pretty common, not very unique. How do I validate an idea like that? Well, if you have a unique selling proposition with your pizzeria, let's say for example, you specialize in certain types of pizzas, or you're a high end pizzeria, or where it's like adults only and it's great for date night, or your pizzeria has a membership model where you get a certain number of pizzas every month. Whatever. The point is that you're delivering or you're offering your product in a new or different way. A lot of people think that their ideas have to be like completely innovative, like Airbnb or Uber or Tesla. They don't. All that matters is that you have proof that people want what you're offering even if your idea is not unique at all. But there's a need. There's a need in your area, there's a need in your locale for that business or in that country. For example, there is a app called TaskRabbit in the US which is basically a marketplace for random tasks. You can ask people to do certain tasks and you can post, you know, that job for a certain fee. TaskRabbit did not exist in Australia, so somebody came up and said, hey, there is no TaskRabbit here. This marketplace is completely open to this idea. I'm gonna do the same concept so but launch it in Australia and call it Airtasker. Not a completely novel idea, but the marketplace where that person was located needed it. You got to make sure you know there's enough people that want what you're going to offer to help you out with that. I want to give you access to our free course. It's actually one of our most popular courses inside the Hundred Dollar MBA. It's called the Five Steps to Idea Validation. If you go to100mba.net free course, you can get free access to that video course and workbook instantly. Also, G has a great gift for you that he wanted to share with everybody. It's an ebook that you can get for free called Secrets of Insanely Successful People. Just go to jeepenergy.com download well, that wraps up today's lesson. I hope you enjoyed it. Thanks again Jeet for that great lesson. Before I go, I want to leave you with this. I love how Jeet says fail fast. You want to validate your ideas quickly, find out if there are winners or duds and move on so you can start working on it or move on.

To something that is going to work.

Don't dilly dally on this step. Really validate quickly and don't be so precious. Don't be so emotionally attached to ideas. Your ultimate goal is to be a successful entrepreneur. How you get there will depend on what ideas, what products you bring to the marketplace. So find ideas that will work so you can get to your goal. All right, I'll check you in tomorrow's episode. I'll see you then. Take care.

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