- This is how you build a massive online
business with little to no money.
I'm Tom Bilyeu for Goalcast.
I co-founded the billion dollar company Quest Nutrition,
which was named by Inc. magazine as the second
fastest growing private company in America
in our fourth year in business.
In our first three years alone we grew by
57000% and it all started as a small online business
that we launched from our living room floors.
All right, grab something to take notes with,
because I'm gonna give you the step-by-step
instructions on how to build an online business.
Step number one, start with why.
The days of building a company on the back of a weak
product perfectly marketed are thankfully over.
In the era of social media, you're gonna live and
die by A, your product quality, and B, what you and
your product mean in the minds of the consumers.
The product quality is gonna speak for itself.
It either will work and be better than
what else is on the market, or it won't.
But what you mean to your customers,
that requires a mission.
People need to know why you're selling this product,
why you, what does it mean to you?
Is it just about money, or is there something more?
Millennials and Gen Z are fanatical about the intentions
of the companies they support with their dollars.
One of the most important marketing vehicles is
going to be your story, your why.
At Quest, for instance,
our why was to end metabolic disease.
That was the thing that drove all of our decision-making.
I'd grown up in a morbidly obese family, so for me
it wasn't just about wanting to make a lot of money,
it was about wanting to help people like my family.
And that mission, that why, not only was our North Star,
it was a powerful marketing vehicle.
It let our consumers connect with us authentically,
and it allowed us to tell them who we are.
Because of that, they could feel good about supporting us
and recommending us to other people.
The other reason that starting with your why is
so important is that you're going to need something
other than money, I promise you,
to see you through the hard times.
Most entrepreneurs don't fail because they don't
understand business, they fail because they
don't love what they're doing enough to push
through the mountain of boredom and suffering
that are inevitably going to be faced
as they get their company off the ground.
I have a plaque that reads, "Find something you
"would die for, and live for it."
When you believe in something that much,
then you're gonna have the energy to fight
through all of the hard times.
Two, decide if you're gonna make a physical product,
and I'll include software here, an information product,
or simply market someone else's physical or information
product as an affiliate marketer.
Creating a physical product, including software,
is the most expensive of the three and will
require the most startup capital,
but also usually reaps the largest rewards.
But startup capital, which is really just a
fancy way for saying the money you're gonna need
to create the product and get the company started,
is a determining factor for a lot of people.
If you can't afford the development or
prototyping phase of a business,
then you're gonna have to decide if you wanna raise
capital or if you wanna create a business around
information or become a reseller or affiliate
marketer for someone else's products.
All are perfectly acceptable and can be
strong and profitable businesses,
but you need to be realistic about what
fits your personality, your desired income,
and your access to capital.
For the scope of this video, though,
I'm just going to assume that you wanna launch a business
that you can start quickly and with virtually no cash.
To that end, most people will end up being a
reseller or becoming an affiliate marketer,
so I wanna define those two a little bit more closely.
A reseller is somebody who buys an already made
product at a discount and sells it at a markup.
Think of Amazon.
They are a reseller on steroids.
In the beginning they didn't make any of their own products.
They bought products off of other
people and sold them on their website.
Admittedly, that's an oversimplification,
but to avoid getting bogged down
I'll leave it at that for now.
The upside of being a reseller is that you get
to sell a product that you really believe in
that solves a real problem and that the company
is probably is working hard to promote on their
own in addition to your own efforts.
The downside is that to get that discount
you may have to buy in bulk and you almost
certainly have to hold inventory.
That means you're upfronting cash.
Also, you'll have to fulfill the orders yourself,
and that can turn into a real beast as your sales grow.
An affiliate marketer, on the other hand,
while it's a lot like a reseller,
you don't have to buy and hold inventory.
You simply do the marketing and then you send
people over to the manufacturer's sales team,
either via the web or phone or whatever means the
company wants their leads to come in to them.
They do the work of closing the sale and then
they send you a commission check on every sale
that they make from the leads that you send them.
Again, I'm really simplifying here as there are
several flavors of this including dropshipping,
where the customer's entire experience
is with you from beginning to end,
but all fulfillment and logistics
are handled by the manufacturer.
But that at least gives you guys a couple of the
different possible avenues that you can head down,
at least at a really high level.
Three, solve a real problem.
Whether you decide you want to create a new product,
build an app, or market someone else's product,
make sure that a huge part of your decision-making process
is whether or not the product you plan to create or back
solves a real problem that a lot of people have.
The easiest way to sell a product is to show people how
it solves a problem that they already know they have.
Part of the reason that Quest was so successful
is that people have to eat every day,
and more and more people were waking up to
the fact that what they eat massively impacts
their health and overall well-being.
But people also want to enjoy their food.
At the time that we launched, most people believed
that food was either delicious or healthy,
but definitely not both.
So our job was to make food that people could choose
based on taste and it happened to be good for them.
Once we had done that, one of the most powerful growth
strategies that we had was just giving the product away.
Once people tried it and saw that it was both
healthy and delicious, then we had a customer for life.
Step four, let's talk about sales and marketing.
Once you have the product that you're going to sell,
now the process of no B.S. execution begins.
Remember, only execution matters.
Don't be overly precious about your ideas.
Tell anyone and everyone who will listen what you are up to.
You never know who's going to be able to help you.
As a quick primer, think of marketing as letting
people know that your products exist,
what problems it solves, and how they should feel
about themselves if they use your product.
We could do a whole master class on that sentence alone,
so for now I'm just gonna leave it at that.
If marketing is awareness and meaning,
sales is actually getting people to pay for the product.
Before you can go too far with sales and marketing,
you need to pick a name for your company.
Personally, even if I were merely being a reseller
or affiliate marketer, I would make sure that in
the marketing of that product I insert my
company's brand and personality.
I would not try to be an invisible middleman.
A big part of the reason for this is that
I don't want to be beholden to just one
manufacturer if I can at all avoid it.
I want to represent an industry.
Take Thrive Market as an example.
Their why, their mission, is to help people
find the highest quality healthy foods.
If one manufacturer goes away,
they simply move on to someone else.
Their business isn't beholden to any one company.
So diversify just like they do wherever you can.
And when you're picking your name, make sure it's
something that lets people know what you're about.
It should be broad enough to cover the industry
that you represent, but not so generic that
no one knows what you do.
Thrive Market again is a great example.
Their name makes sense with their mission,
but it's not something hyper-specific like Vegan Market,
which is very limiting in its scope.
When choosing a name, make sure it's something
that you can really own, and by that I mean
make sure it's not too common.
You want something that you'll be able to get
the social handles for and that you can
really own from an SEO perspective,
and SEO is search engine optimization.
Also, pay attention to the associations
that people have with the name.
Make sure it says something to
people that you want it to say.
When I was naming our new company, Impact Theory,
which is a media company designed to
give people an empowering mindset,
I originally wanted to call it Mission House,
but when we ran the name by focus groups,
they all said that it made them think of
a soup kitchen for homeless people,
so we went back to the drawing board.
Once you have your name, step one of marketing
in this day and age is social media.
Five or six years ago I would've said that
step one was your website, but now,
no question about it, it's your socials.
You need to embrace that if you're going to sell today
you must become an effective content creator.
And all of your marketing should be value-add.
When we started Quest, our whole mantra was
that the first rule of Quest marketing was the
same as the first rule of fight club.
You didn't talk about Qeust.
We just wanted to create something that was of value.
What exactly you're selling is gonna determine
which platforms you'll focus on,
but no matter what you focus on,
you wanna make sure that the content
in and of itself is interesting.
Now, the most obvious and universal platforms are,
A, Facebook, for all the drama around Facebook
these days it is still the 800 pound gorilla.
Not only does their user base dwarf everything else,
their back-end marketing tools will help you reach
your target market with a high degree of specificity,
which means you're gonna be able
to keep your costs really low.
B, Instagram, Insta is great for establishing
the look and feel of your company and giving
people that bite-size content that they can snack on.
It is super visual and super simple
to use and interact with people,
and they continue to update the platform to
make selling easier and easier.
C, Twitter, whether it's dying or not is up for debate,
but regardless of whether it lasts another five years,
right now it is the platform for direct conversational
contact with your potential customers.
It is super real time and a great place to see what's on
the minds of your customers right then at that moment.
It's a great place to keep your finger
on the pulse of your brand's sentiment,
and paying attention to that is absolutely critical.
D, YouTube, this is the hardest to build,
but the one, in my opinion, with the deepest impact.
At Impact Theory, our average view duration,
the amount of time that people spend watching
one of our videos, is about 15 minutes.
On Facebook, for the same video, it's around five minutes.
So the same video gets three times the amount of
engagement just based on a different platform.
Let it go without saying that to leverage social media
you really have to make awesome content.
Your content has to add value to people.
People should want to watch your content in and of itself,
regardless of whether or not they wanna buy your product.
Masterclass, to me, if you guys haven't seen these ads,
they're incredible, they are the best example
of this that I have ever seen.
I have never taken one of their courses,
but I watch all of their trailers.
Even their trailers, just by themselves, are awesome
and I feel like I'm learning something.
That is value-add marketing at its finest.
And it is the only kind of marketing
that works in today's world.
As you're building out your socials
and developing your social strategy,
you need to also get your website up and running.
Social channels are way powerful,
but you're renting your audience from the platform.
You don't own them, and the platform could go
out of business or simply decide that
nothing is free anymore, and that is for sure
the direction that Facebook and IG are going.
Your website, and especially your mailing list,
are how you're going to build something
that no one can take away from you.
It's the place where you get to have a direct
relationship with your audience.
Make sure that your website is engaging and sticky,
and you do that by creating custom
content that they can only get there,
and make sure that you have some amazing free content
to entice people to sign up for your newsletter.
The old adage is that it takes
seven touches to get a conversion.
Your social channels will do a lot of the heavy
lifting for you, but you're going to find
that on social you can't sell as hard
as you can in, say, a newsletter.
So for the real sales, your website and newletter
are gonna do a lot of the work for you,
so make sure you focus on making them extraordinary.
People have got to want to engage with them.
When creating your website, use a template, my friends.
I cannot stress this one enough.
You can customize it all you want,
but unless you're a web developer you are going to
lose an insane amount of time making a custom website.
There are so many options these days for
literally buying a website off the shelf,
but my advice is the ever faithful WordPress.
It makes your site super easy to create,
customize, and manage.
As a part of creating your website you're going tp
want to make sure that you have a sales funnel.
This is just a fancy term for how you take people
from just finding out about your brand and or product,
all the way through to actually buying.
Now oftentimes you don't go for the sale right away,
you want to nurture your customer by adding value
for free, can't stress that enough, for free,
and then simply making them aware of your product
offerings once they realize what you're all about,
that you're all about value creation,
and that they can trust you.
Because once they trust you and know that you
only offer things that are of the highest quality,
they are way more likely to do business with you.
Once your website is up and running,
you want to wire it to handle transactions.
If you're doing just affiliate marketing,
this isn't necessarily that important,
but if you're actually going to do the transactions
you're gonna need to wire yourself for e-com.
And assuming that you're going to handle your own
transactions you're gonna wanna use a pre-made
e-com solution like Shopify that will plug
directly into your website and allow
you to process sales immediately.
It's really pretty remarkable how far this has
all come in just the last five to seven years,
there really are no excuses for setting up an e-com site.
It takes very little money.
You can get these solutions off the shelves.
It is just absolutely amazing.
So make sure that you're taking advantage of this stuff
by using these solutions rather than
trying to do everything custom.
Not only is it gonna save you time and money,
but there will be plenty of people out there that know
how to use and or modify your setup, and as you grow,
that is gonna become increasingly important.
But when it's custom, finding people that can help
you without first having to be trained
on your entire system is brutal.
Step five, decide if you're going to
register your company and get a tax ID.
The legal and tax side of things is the least fun,
at least for me, but it's absolutely critical.
The only way around this step is to remain
a pure play affiliate marketer.
And by that I mean that you're not handling
the sales on your own website,
you're simply passing the lead off to the
manufacturer and they're closing the sale.
If you do that, then you can get away with a simple 1099.
But assuming you're creating your own product
or you're a reseller, then you're going to have
to register your company and get a tax ID.
The good news is, just like the e-com solutions
and just like the fact that you can get websites
that are templates, these days,
even the process of setting up and incorporating
your company comes with a lot of help if
you're using a service like LegalZoom.
As of this recording, LegalZoom offers LLC
creation packages for less than a hundred bucks.
So setting up a company has never been easier.
Now, beware, because it does vary wildly
state to state and country to country,
but truly, with all the help that you
can get online, it has never been easier.
A few Google searches with terms like register
my company or setting up a new business,
we're gonna get you started.
Step six, the last thing I'll say is,
don't let any of the technical stuff or any
of the legal stuff bog you down.
The important thing is that you get started.
You can start building your audience right now today
with a simple Facebook account and a smartphone.
It really has never been easier.
In fact, we started Impact Theory just building
our social channels and getting people
into our newsletter mailing list.
And we did that long before we had anything to sell,
but we had tens of thousands of people in
our ecosystem before we ever tried to sell something,
which meant that our sales had a lot of momentum.
And momentum matters.
Literally, momentum is everything.
Not only do I want you to not worry about getting
bogged down in all the technical stuff,
I want you to tell everyone what you're up to.
Try to get people excited about your idea
rather than worrying about people stealing it.
Ideas literally are a dime a dozen.
The only thing that matters is execution.
And while we are on the topic of execution,
my friends, be sure to read the book
E-Myth Revisited by Michael E. Gerber.
It is one of the best books on starting and
running a small business I have ever read.
All right guys, I believe in you.
I know you can do this.
I know you can build a successful company online.
When I started my entrepreneurial journey
I had no idea what I was doing.
Literally none.
And yet, ultimately, my partners and I
build a billion dollar business.
All it takes, all it takes,
is the commitment to never-ending learning.
Don't worry about being good today,
just be committed to getting great over time.
And nothing, nothing, teaches more powerfully than
action and failure, so put yourself out there
with an open mind and a willingness to learn,
and on a long enough timeline, you will succeed.
This has been Tom Bilyeu for Goalcast.
If you want more free content like this or want
to learn more about my mission to build a media
studio to rival Disney, follow me everywhere
at @tombilyeu or visit my website impactheory.com.
If you haven't already, be sure to subscribe to Goalcast,
and until next time, my friends, be legendary.
Take care.
(rousing orchestral music)