I’m Broke, What Should I Sell?

Video

Summary

• When choosing what to sell, consider the limited categories of products: physical and digital goods, services, access, attention, risk (insurance), money, endorsements, or a combination of these.
• Your previous experiences, skills, and resources determine what you can sell effectively; utilize knowledge from your background or upbringing.
• For those with limited funds, such as $100, selling time-intensive services is a practical starting point.
• To scale a business offering, apply the 'Delivery Cube', which considers one-to-one versus one-to-many delivery, DIY versus DWI versus done-for-you models, the type of support offered, the mode of content consumption, the speed and convenience of service, and what changes would be needed to justify 10x higher or lower pricing.
• Experiment with the level of support and consumption mode to find the best balance between value and scalability.
• The 10x to 1/10th test helps explore the potential changes needed to justify significantly altered prices and can reveal innovative ways to offer value.
• This advice aligns with strategies I discussed with entrepreneurs at the University of Texas, emphasizing starting small and scaling intelligently based on one's unique advantages and constraints.

How To Take Action

I would suggest identifying what you can sell based on your skills and resources. Look for what you know more about than others because of your past experiences. Let's say your mom is a great cook, you might have food recipes that you can share or offer cooking classes.

For those with little money, like $100, selling services that need your time, like tutoring or consulting, is smart. You want to give people a lot of help without spending too much cash.

Now, let's talk about the 'Delivery Cube'. Think about if you can teach one-to-one or one-to-many. Can you make videos for many people to watch? Or do something with a few people at a time? That's important for growing what you offer.

Next, look at 'do-it-yourself' versus 'done-for-you'. If you're like guiding someone, that's 'done with you'. Think about what support to offer. Chat? Email? Phone? Each one affects how many people you can help at once.

Consider how people will get what you sell. Is it a live class, a recording, or maybe an ebook? Live is often seen as better but can't reach as many people.

Then, think about speed and ease. Can people get your service all the time? Or do you answer quickly during work hours? This will affect how many people you have to help out.

Finally, do the 10x to 1/10th price check. If you had to charge ten times more or only one-tenth, how would you change what you sell? This helps you find ways to give a lot of value or figure out how to do it cheaper but still good.

So, start small, use your unique skills, and smartly grow your offerings. This approach helps you focus on what's important and how to make your business better.

Quotes by Alex Hormozi

"Digital and physical formats of each of these things actually give you 14 different things you can possibly sell"

– Alex Hormozi

"If you're a first-time entrepreneur, then you're like, well, I don't have any other experience, but you actually do"

– Alex Hormozi

"Now you might record it and then also sell the digital versions"

– Alex Hormozi

"Here's the person I provide the most value to for the least amount of money to me, that's where your sweet spot is"

– Alex Hormozi

"Anything that's live is typically going to be perceived as more valuable"

– Alex Hormozi

Full Transcript

University of Texas for a class on entrepreneurship there are some people here who don't try for one of the key questions that many of the aspiring entrepreneurs in the classroom asked is what should I sell first off we have to Define what are the actual things that can be sold and this may sound crazy but there's actually fewer of them than you think and there's digital and physical formats of each of these things which actually give you 14 different things you can possibly sell once I Define those I'll talk about how we can increase the scale of the deliverable that we have using something that I call the delivery Cube number one is you can sell products you could sell a physical product which would be like I sell water bottles a digital product would be something like a PDF the second category is services so this is stuff you do for other people in the Physical Realm a service would be a massage mowing someone's lawn fixing someone's car on the digital side oftentimes that service is something that happens in the digital space so if you are an ad agency and you make ads the ad itself that you're making as a service also buying media is a service all of those things would be Digital Services category three you have access Visual access is like you lease a building you gain access to the building digital access is you gain access to a library of digital content like Netflix category 4 is attention you can sell or buy physical attention that could be like a billboard cars physically drive past it and see it to the same degree Facebook and Google have digital attention and they sell the eyeballs and the attention of that audience Category 5 like the hurricane is risk selling insurance but you can insure a building but you can also insure against in the digital format a cyber threat if you're an established business owner and you sell physical products or even Services you can sell the risk associated with it which is like ensuring the product so some people give guarantees but you can actually get people to pay for a guarantee which is Insurance just like AppleCare is just paid for insurance the next thing you can buy or sell is money itself the entire banking industry is predicated on buying and selling money and the rate they charge is the interest itself and so you can have physical money right like the actual US Dollars you can also have digital money which I'm not going to get into crypto but that is a form of digital money category seven is an endorsement or brand in the physical world I say hey you can use my logo on your shirt and you give me a percentage of all your sales in the Digital World when they sell a check mark on Instagram that is selling an endorsement it's selling a brand it's selling some sort of status that gets transferred and a fee is paid as a result of that one of the key points here is that it can be a combination of those categories so if someone sells a rock concert for example you're selling access to an experience but you might also sell drinks and t-shirts while you're there now you might record it and then also sell the digital versions that see what I'm going with here in terms of picking which one to sell it's mostly going to come down to two things one is the resources you have and your skills value experience if you're a first-time entrepreneur then you're like well I don't have any other experience but you actually do and let me hear me out your parents did something and if you don't have parents the people who praise you did something and if no one raised you people you knew did something and you were around them so like for example my mom is a doctor she's an eye surgeon so I know a lot of stuff about eyes that would be a category of stuff that I actually know a lot more about than you might expect if your dad was a mechanic you probably know what a carburetor is I have no idea what it is I've heard the word before oftentimes you've had little odd jobs like when I was in high school I was a blender tenor and then I did catering at an Orthodox Jewish company you probably know a lot of stuff just from osmosis of being around it we have these seven things digital and physical is there any one of these that already have a little bit more experience with and then of those things which problem is the biggest that I think I can solve given the resources that I have access to what I was talking about with this entrepreneurship group is that they had a hundred dollars to start their business now that would probably preclude you from most physical products probably most kind of digital like software type stuff and so most of the time you're going to start selling your time which is often Services here's the person I provide the most value to for the least I'm amount of money to me that's where your sweet spot is as the first or next thing that I would probably package and sell once you've established that how can I enhance or make it more or less valuable or more or less profitable for me as a business owner the delivery Cube has six pieces to it that's eight six number one is can I deliver this thing one to one in a small group can I deliver it one to many each of these have different value propositions that are associated with them if you sold semi-private group stuff it's a small group of five people doing something that's different than doing a webinar to a thousand people at once versus having a call review system where you review someone's calls to give them feedback one-on-one the second frame of the delivery cube is do it yourself DIY DWI which is done with you as in you're holding their hand through the process of whatever it is you're doing or done for you where you do all of the work yourself and you sell them a final product or final outcome each of these give you different levels of scale do it yourself you can sell it unlimited out typically the value is smaller done with you you have in between mean the two extremes of do-it-yourself and done four you've done for you is the most expensive typically sometimes the easiest to sell but one of the hardest things to deliver on the third frame is what level of support am I going to do and specifically on what medium am I going to offer support via chat am I going to offer support via email am I going to offer support via phone call gonna be Zoom call these are all different ways that I can support whatever the thing is that I'm selling obviously if I do email support that's going to be significantly more scalable it'll probably also be significantly less valuable than somebody who's real time available to hop on a zoom call whenever they want filter number four is how do I want them to consume the thing they can consume it visually they consume It audio wise they could consume it live they consume a recording they consume it visually via text so there's different ways we can have people consume some sort of thing whatever it is anything that's live is typically going to be perceived as more valuable and if it's in person and live probably the most valuable and probably the least scalable on the flip side if I did something that was recorded and was digital it would be the most scalable but probably the least valuable the fifth lens is the speed and convenience of whatever we're delivering this comes down to multiple things one is it 24 hours a day or is it just nine to five frame two is how many days a week am I maintaining that level of service three is how fast is that response so I might be open 24 hours a day but I have responses that are guaranteed in 24 hours which is different than saying I'm open nine to five five days a week but I respond within three minutes and the ultimate extremes are either you're overstaffed but your customers don't have to wait you incur inefficiency so that they have convenience or they incur the inefficiency and all of your staff is 100 utilized because they're going call to call to call all day long different strategies there's wildly successful companies that do both frame six is what I like to call the 10x to 1 10th test if I charge 10 times more for my current thing what would I have to change about my thing that I sell in order for it to be worth 10 times more this ultimately gets me thinking in much bigger ways about how much value I would need to provide let's say I go from a ten thousand dollar thing to a hundred thousand dollar thing that still would be profitable at a ten thousand dollar thing it just makes me think differently because I now have to justify my hundred thousand dollar price tag the flip side of that is equally powerful which is if I had to deliver the same or even more value than I currently am but I could only charge one tenth the price that I currently am what else would I do that would be perceived as valuable but would not cost me enough so I could still justify one tenth the price but maintain my value this gives me a very good starting point to both figure out what the first thing I might want to sell is and then how can I scale it and make it more profitable and or more valuable to my end consumer and think through the ratio of how many people I would need internally my company to facilitate that and so this is what I was explaining with the University of Texas and if this was interesting to you we actually have the entire full lecture in Q a the link somewhere around here I'm sure it'll be available to you if you want to watch the whole thing go click there and check it out