What Business to Start in 2023

Summary

• When you're overwhelmed with business opportunities, having a strategy is crucial. Without a strategy, you'll struggle to decide which opportunity is right for you.
• Create a strategy with constraints that act as decision filters to determine whether an opportunity is suitable for you.
• Write down all your potential business opportunities to assess them thoroughly.
• For each opportunity, list the pros and cons, focusing on market growth rate, margins, and market opportunity, and eliminate those with more cons.
• Consider your likes and dislikes for each option. If you have more dislikes than likes, discard that opportunity immediately.
• Evaluate your strengths and weaknesses in relation to each business opportunity. Leverage your strengths and avoid areas where you are weak.
• Craft a mission statement. It's essential to know what you want to do and why before diving into the details. The mission acts as your primary decision filter.
• Select core values that are authentic to you and that will help you achieve your mission. Use these values as additional decision filters for opportunities.
• With your mission and values in place, assess the remaining opportunities. Only consider those that align well with both.
• Consider the worst-case scenario for each opportunity. The best CEOs plan for the worst and choose the option with a downside they can live with.
• Avoid starting a business based on potential profits alone; focus on what you could lose and your ability to handle that loss.
• This framework separates emotion from decision-making in business and emphasizes strategic planning and self-awareness.

Video

How To Take Action

I would suggest implementing a simple strategy to avoid feeling overwhelmed by business opportunities. Start by creating a list of all potential business ideas. Then, for each idea, write down the pros and cons, especially the market growth, margins, and overall market opportunity. If there are more cons than pros, eliminate that option right away.

Next, think about what you like and dislike about each opportunity. If you dislike more than you like, remove this option, as it's essential to enjoy what you do. Also, evaluate your strengths and weaknesses in connection with each idea. Focus on opportunities that play to your strengths, and discard the rest.

A good way to clarify your direction is to craft a mission statement: what do you want to achieve and why. Use this mission as a filter to assess opportunities. Choose core values that reflect who you are and use these as additional filters.

Assess the remaining opportunities against your mission and values. If an option doesn't align with them, it's not for you. Finally, consider the worst-case scenario for each business idea. You want to pick opportunities where you can handle the potential downsides. This approach separates emotion from decision-making, focusing on careful planning and self-awareness.

Using this framework, you prioritize low-cost, high-value opportunities tailored to your strengths, preferences, and values, ensuring a strategic approach to selecting the right business opportunity.

Quotes by Leila Hormozi

"When you lack strategy, you have a lot of opportunities"

– Leila Hormozi

"Strategy is a series of constraints that you create or conditions in order to get to a goal"

– Leila Hormozi

"If you have good decision filters, most opportunities are good opportunities; they are just not your opportunities"

– Leila Hormozi

"The mission is your first decision making filter"

– Leila Hormozi

"The best CEOs make decisions based on worst case scenario"

– Leila Hormozi

Full Transcript

figure out what business to start this is not something I normally talk about in fact I don't usually talk about how to start a business but I have so many people coming to me with questions of Layla I have so many opportunities how do I figure out which one is right for me what I'm going to share with you today is really the process that Alex and I used to figure out that acquisition.com was the opportunity we want to pursue there are a million opportunities out there and our list of opportunities in terms of all the different businesses that we could start was almost unending if you don't have a framework around figuring it out it can become very overwhelming and I completely understand that so my goal with this video is that you walk away feeling less overwhelmed than when you started watching the video so the first point I want to make when you lack strategy you have a lot of opportunities the reason that you're watching this video right now and you're thinking I need to figure out what opportunity to pursue the issue is they don't have a strategy what I want to First help you create is figure out what strategy you're going to pursue and then the constraints around that strategy constraints are decision filters strategy is a series of constrained that you create or conditions in order to get to a goal and then those constraints are really decision filters in which you filter all opportunities through those constraints and say do they pass or do they not pass if you have good decision filters most opportunities are good opportunities they are just not your opportunities so what I'd like you to do is honestly just do this live with me I really come down to 10 steps to figuring out what business opportunity to pursue if you have three four five opportunities that you're thinking of what I want you to do is pause this video and write those down because we're going to go through it line by line write down all the opportunities that you have what are the top five opportunities that are out there in terms of businesses that you could pursue step number two is I want you to write down the pros and cons of each what I want you to think about with pros and cons is what's the market opportunity if you have Airbnb as one of your opportunities go Google Airbnb right now and look at the market growth rate at what rate is the market growing and then compare that across all the five opportunities you have would you consider the market opportunity Pro or con second piece is margin I want you to take each of those opportunities that you have and Google what is the typical margin in that industry and then look at them and in comparison with the margin for Airbnb versus online education business be a pro or a con one might be 10 one might be 50 obviously higher margins are better the third is really the market opportunity so you might see the growth rate in an industry is high but is there an opportunity for your business in that market is the growth rate the market opportunity and the margin considered a pro or con I'm not saying this is right or this is the standard this is just what I used to figure out acquisition.com now the next step is whatever ones out of those have more cons than Pros toss it immediately it doesn't matter how you feel about the opportunity if there are more cons than there are Pros immediately cross it out so do that before going to the next step I want you to write down your likes and dislikes about each of those opportunities so say you've got Airbnb and the average margin is going to be you know all in 30 it's got a pretty good growth rate decent opportunity so eyes what are your likes and dislikes do you like real estate do you like managing tenants do you like managing multiple houses or do you dislike those things do you want to have a team do you want to not have a team which businesses would require those things write down all the things that you like and don't like about what you currently know about each opportunity because here's the thing you're not going to know everything that goes in every opportunity but you do know off the bat do you like it or not like it and here's where a lot of people make the mistake is they pick something that might be the best opportunity it might have all the best growth rate it might have the best margins and they hate it if you hate it it's not gonna work second piece of that is that anything that you dislike more than you like crossed off immediately it doesn't matter if it's a billion dollar opportunity crossed off right now the fifth is I want you to write down your strengths and your weaknesses in relation to each opportunity if I look at acquisition.com listen to how me and Alex thought about this Alex is a fantastic marketer he's so good at social media and content all these things we can put so much content out there Alex is so good at doing that eventually we'll get people that just Google our name and want to invest their business is with us and on the other side I'm very good at operationalizing infrastructure and recruiting which then we happen to build around acquisition.com's core infrastructure so the business was built around both of our core strengths we looked at other businesses such as online weight loss we were like we could build the biggest health and fitness online company in the industry because that's something that's a core strength of both of ours we could be forward-facing we could be in the fitness industry we have background industry knowledge guess what we both hate that idea and so though we have more industry knowledge and we had all the market opportunity and everything was liner favor it was not something that we wanted to do now that you've identified where you're strong and where you're weak where your core strengths align with the core needs of the business any opportunities that you have on there where it does not involve your core strength is cross those out and now what you're left with are probably the opportunities that have Market opportunity have margin have a good growth rate what you like and you're good at and that's what you want and now once you have those what we're going to do is we're going to create your mission statement you don't have to have a business before you decide what the mission is for acquisition.com we were not 100 sure with the business we wanted to look like but we knew that we wanted to document and share the best practices of building a world-class business so we started with that mission statement and then we said what does that company look like what's your two statement the purpose of this business is two the purpose that I'm on the mission I have is two so like I said ours is two documented share the best practices of building a world-class business Jim launched we had gym Walsh for a very long time the mission was is to bring the industry from its knees to its feet the gym industry was falling and we wanted to make sure that we could actually bring it back up and so every business is going to have a different Mission but figuring out what your mission is before you get into all the hairy details is more important and the mission is your first decision making filter so every opportunity that you come across if it doesn't fit with that mission you're not going to pursue it so you have to understand that if somebody came to me and said Layla I want to make a TV show about you guys that sounds terrible and horrible in all many ways but at the same time is that going to help us document and share the best practices of building world-class business the answer is yes why am I making YouTube videos why am I making tick tocks I'm making Twitter because the mission is to document and share we bring all of those things through the decision making filter why do we have free courses on acquisition.com to put them through this decision making folder because that's the mission so once you've identified and just get a rough outline listen it doesn't even be perfect this doesn't even be something that sounds amazing like you can figure out the language later but like ultimately what do you want to do why do you want to do that opportunity now you have to say what is required to succeed at that mission what values must I hold in order to achieve that mission in a way that's authentic to me and that's the question I ask myself what values are required of me to achieve this mission that I already hold that a lot of people think core values they think these are things that I want to be these are things that I should be showing all the time but the thing is if you start talking about those core values you're going to start embodying them more and more so what you want to do is you want to pick out the values the top three that are most likely that if you embody them will get you to your mission the caveat is that you should already have these you know for us examples we have competitive greatness as one of our values if you're not competitively great if you're just money driven don't say you're competitively great but if you are competitively great but you're like I haven't honed in on that it's not in my messaging I haven't even talked about my companies that could be something that you're like but that would be a strategic advantage in accomplishing my mission and building this company then it would be your next decision-making filter or value and so if you think about it now that you've chosen the opportunity and you've put the constraint strategically on what your mission is the next three constraints are basically the how the values are going to dictate how you're going to get there this is my mission and every opportunity gets flowed through it do these align with the mission and then below it you're all the values there's a million ways to accomplish your mission but does the way that I'm being presented with or that somebody told me about does it align with the values is it going down the path that I've outlined to get to that mission if the answer is no then it's not for you and so now what I want you to do is I want you to take those maybe two opportunities you have left and I want you to say do they align with the mission and values I put here do they flow through those filters once you've come up and you've analyzed the business opportunity you've figured out this is my mission statement you have the values that are going to tell you how you're going to get there here's the last thing that you're going to do is you're going to write down say the last two businesses that are opportunities for you and what you're going to say is in the next column you're going to put what is the worst case scenario if this business fails I'll give you an example say you want to start a coffee business and you're like I want to start a brick and mortar coffee business but maybe I'll do it online instead and then you're like Layla which one should I do should I start a brick and mortar coffee store or should I start an online coffee store I'm going to say this to you what's the worst case scenario if the brick and mortar store fails and maybe you say Layla if the brick and mortar store fails I've just signed a five-year lease which I put all of my money into because the down payment for the lease was like 50 Grand which is all I have saved and then now I'm going to owe on the lease but I'm not gonna have a coffee store because it failed I'm like okay well that sucks it's gonna be a lot of debt what about at the online store fails I only have to invest a couple thousand dollars into maybe like a course on how to build an online store and then for the inventory for the coffee worst case I'm probably out like 10 15 grand in my opinion choose the one that you can live with the downside more than the other the best CEOs make decisions based on worst case scenario which worst case scenario could you live with so rather than looking at oh my God I could make a hundred million or a billion dollars this guy told me on this ad what is the worst case scenario you could live with and pick that one that's it now that you've gone through all the filters pick the one in which you could live with the worst case scenario if it failed and so I can tell you that we were looking at acquisition.com there's a million other businesses we could have started or ways we could have built we could have built a real estate portfolio we could have built a d2c business we could have done all these things at the end of the day it comes down to what what is the worst case scenario if it fails and for us the worst case scenario of actors.com were to fail we'd lose very little capital and if anything we gain a ton of knowledge and insight so moral of this framework is that you can't rely on emotions to start a business people everywhere everyone's telling you what kind of business to start they're most likely monetarily incentivized to tell you to start that kind of business they're like you have to start Airbnb it's the best opportunity no you sell Airbnb as an opportunity I'm sure it is to you because you're going to make money from that guy last thing I'll say is that you cannot rely on how much money an opportunity would potentially make you when you are first starting out you almost have to ask yourself how much money will I potentially lose if it fails and can I live with that so listen if you've watched this video and you've determined what you want to do you can also go to my video zero to one million and then I'll talk about the process of going from zero to a million dollars and what that takes tactically in a business