Building a sellable information product business requires shifting from founder-dependent branding to repeatable, recurring revenue. The most valuable models look like SaaS: high-margin and sticky. Convert one-time course sales into memberships and build a team that works without you.
When you're thinking about like business fundamentals, what are the things you're looking at? And, and also like, what are the mistakes a lot of these businesses are making that they could fix early on to be in a position to sell later?
The way that a lot of info product entrepreneurs approach their business is right for them and right for growing their business. And it's not right for creating an asset that somebody else wants to buy. And so it's like a real question or a real challenge to figure out, like, which side of that do you go to as you're growing your business? And I think you have to be like honest with yourself about what do you want to do with the business. Like, for some people, they want it to be a lifestyle passion thing forever, and they're not trying to grow it into something that can be sold. And like, it's totally fine then to like run your business in one particular way, as long as it's meeting your cash flow needs. Like, there's nothing wrong with that. If on the other hand though, you are trying to create an asset that you want to sell, there are a series of things that I think are worth thinking about. And they're things that should be done over a multi-year period. They can't just be done the week before a sale. And I think this is something that I think a lot of entrepreneurs don't get about people that do M&A is they're like, fundamentally different types of human beings. Entrepreneurs are risk takers and M&A people are risk mitigators. So anything that smells of risk, an M&A person's gonna be like, ah, I don't like it. And the entrepreneur may have a good excuse for it, but they're not gonna like it and they can kill a deal. So you're right to say you need to do some of this stuff years in advance. And one of them, I think, You nailed on the head, which is like, if your brand is about you as a person, that's gonna be an impediment to selling your business. So that's the number one thing. So like, this was actually something that we talked through a lot as we were going through the sale of Mastering, which was Blake was the face of Mastering forever, right? Like all the promotional materials, everything on YouTube was Blake. And so, you know, we really had to think through, is there like other people on the team that we wanna elevate? For a lot of info product people, there is no other team. Maybe you have some closers, but there's no other team that's doing the teaching and that's doing the product creation. So that's tough to do. But Blake thankfully had been thoughtful about that and had built a really good team around him. So we were able to do more of that. So that's one thing. I think the second thing that people need to think about is building not one-time sales to clients, But build a recurring relationship with a client, and that doesn't necessarily mean you need to have like a SaaS revenue model. But like if you can establish that your customer base is valuable because they have a high probability of buying from you over time, a buyer is going to value that a lot more than they're going to value you being like you know having bought or. you know, one course 3 years ago and you never touched them again, but they happen to exist on like a mailing list for you. There's 20 other things, but I think those are like 2 really important ones that are important to think about for info products entrepreneurs.
Like, is there sort of like an idealized business structure that's the best to sell?
I think it's a real— that's a huge question. And I think that like, it's not clear what the answer to that question is yet. Because not a lot of these businesses have been successfully sold yet. And I think that's because the business models are still evolving. And I don't think that there's a lot of business models that are yet in that place that like you would look at them in the way that you look at like a SaaS software business. Like a SaaS software business is like the ideal type of business. Super high recurring revenue, super high margins, and like high degree of stickiness of your customers. So like the more that info products can move in that direction, the more valuable they're going to be. So like, what would that, what would that look like? To me, that would look like you're selling community and the value of maintaining Relationship with that community is getting you to stay paying for the service over a longer period of time, which is very different than like, I'm gonna buy this course one time and have access to like a Q&A every once in a while, which is fine. It's a great business. A lot of people, a lot of your listeners have made a ton of money doing that. It's awesome. They're all living better lives for it. But if you think about like, how do you take that and then get your, you know, 10x multiple off of your earnings. Like, that's the direction that these businesses need to move. And I'm not sure that anyone's like fully cracked exactly how to do that yet.
But tactically, it would be turn like a one-time thing into maybe like a membership that's recurring every year.
