The $100 Startup by Chris Guillebeau
These are my personal book notes of "The $100 Startup" by the author Chris Guillebeau.
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- Author: Chris Guillebeau
- Title: The $100 Startup
- Subtitle: Reinvent the way your make a living, do what you love, and create a new future
- First published: 2012
- Type: non-fiction
- Genre: self-help / marketing
- Author's website: chrisguillebeau.com
- Rating: 9/10
- Recommended: Yes (Hell Yeah!)
Table of Contents
- Prologue: Manifesto - A Short Guide To Everything You Want
- Part 1 - Unexpected Entrepreneurs
- Chapter 1: Renaissance - You already have the skills you need - you just have to know where to look.
- Chapter 2: Give Them the Fish - How to put happiness in a box and sell it.
- Chapter 3: Follow Your Passion… Maybe - Get paid to do what you love by making sure it connects to what other people want.
- Chapter 4: The Rise of the Roaming Entrepreneur - "Location, location, location" is overrated.
- Chapter 5: The New Demographics - Your customers all have something in common, but it has nothing to do with old-school categories.
- Part 2 - Taking It To The Streets
- Chapter 6: The One-Page Business Plan - If your mission statement is much longer than this sentence, it could be too long.
- Chapter 7: An Offer You Can't Refuse - The step-by-step guide to creating a killer offer.
- Chapter 8: Launch! - A trip to Hollywood from your living room or the corner coffee shop.
- Chapter 9: Hustling: The Gentle Art of Self-Promotion - Advertising is like sex: Only losers pay for it.
- Chapter 10: Show Me the Money - Unconventional fundraising from Kickstarter to unlikely car loans.
- Part 3 - Leverage And Next Steps
- Chapter 11: Moving On Up - Tweaking your way to the bank: How small actions create big increases in income.
- Chapter 12: How to Franchise Yourself - Instructions on cloning yourself for fun and profit.
- Chapter 13: Going Long - Become as big as you want to be (and no bigger).
- Chapter 14: But What If I Fail? - How to succeed even if your roof caves in on you.
- Disclosures And Interesting Facts
- But Wait, There's More!
- Fish Stories Appendix: Twenty-Five Selected Case Studie
- Rockstars From The $100 Startup
From the Prologue: Manifesto - A Short Guide To Everything You Want
Imagine a life where all your time is spent on the things you want to do.
Imagine giving your greatest attention to a project you create yourself, instead of working as a cog in a machine that exists to make other people rich.
Imagine handing a letter to your boss that reads, "Dear Boss, I’m writing to let you know that your services are no longer required. Thanks for everything, but I’ll be doing things my own way now."
Imagine that today is your final day of working for anyone other than yourself. What if - very soon, not in some distant, undefined future - you prepare for work by firing up a laptop in your home office, walking into a storefront you’ve opened, phoning a client who trusts you for helpful advice, or otherwise doing what you want instead of what someone tells you to do?
All over the world, and in many different ways, thousands of people are doing exactly that. They are rewriting the rules of work, becoming their own bosses, and creating a new future.
This new model of doing business is well under way for these unexpected entrepreneurs, most of whom have never thought of themselves as businessmen and businesswomen. It’s a microbusiness revolution - a way of earning a good living while crafting a life of independence and purpose.
Other books chronicle the rise of Internet startups, complete with rants about venture capital and tales of in-house organic restaurants. Other guides tell you how to write eighty-page business plans that no one will ever read and that don’t resemble how an actual business operates anyway.
This book is different, and it has two key themes: freedom and value.
Freedom is what we’re all looking for, and value is the way to achieve it.
It’s a Blueprint, Not a Vague Series of Ideas
I’ll share more of my own story as we go along, but this book isn’t about me - it’s about other people who have found freedom, and how you can do the same thing.
During an unconventional book tour, I traveled to sixty-three cities in the United States and Canada (and eventually more than fifteen additional countries), meeting with people who had made the switch from working for The Man to working for themselves.
I then worked with a small team to create a comprehensive, multiyear study involving more than a hundred interview subjects.
Combing through reams of data (more than four thousand pages of written survey answers in addition to hundreds of phone calls, Skype sessions, and back-and-forth emails), I compiled the most important lessons, which are offered here for your review and action.
This blueprint to freedom is fully customizable and highly actionable. At many points along the way, you’ll have a chance to pause and work on your own plan before continuing to learn more about what other people have done.
A few of the people in the study are natural-born renegades, determined to go it alone from young adulthood onward, but most are ordinary people who had no intention of working on their own until later in life.
Several had been laid off or fired from a job and suddenly had to find a way to pay the bills or support a family. (In almost all these cases, they said something like, “Losing my job was the best thing that ever happened to me. If I hadn’t been pushed, I never would have made the leap.”)
Make no mistake: The blueprint does not tell you how to do less work; it tells you how to do better work. The goal isn’t to get rich quickly but to build something that other people will value enough to pay for. You’re not just creating a job for yourself; you’re crafting a legacy.
This blueprint does not involve secrets, shortcuts, or gimmicks.
There are no visualization exercises here. If you think you can manifest your way to money simply by thinking about it, put this book down and spend your time doing that.
Instead, this book is all about practical things you can do to take responsibility for your own future. Read it if you want to build something beautiful on the road to freedom.
Can you transition to a meaningful life oriented toward something you love to do?
Can you make money doing it?
Yes, and here are the stories of people who have led the way.
Follow it to create the freedom you crave.
The $100 Startup Model
- Follow-your-passion model. Many people are interested in building a business that is based on a hobby or activity they are especially enthusiastic about. As we’ll see, not every passion leads to big bank deposits, but some certainly do.
- Low startup cost. I was interested in businesses that required less than $1,000 in startup capital, especially those that cost almost nothing (less than $100) to begin.
- At least $50,000 a year in net income. I wanted profitable businesses that earned at least as much as the average North American income. As we go along, you’ll notice that the range varies considerably, with many businesses earning healthy six-figure incomes or higher, but a baseline profitability level of at least $50,000 a year was required.
- No special skills. Since we were looking at ordinary people who created a successful business, I had a bias toward businesses that anyone can operate. This point can be hard to define, but there’s a key distinction: Many businesses require specialized skills of some kind, but they are skills that can be acquired through a short period of training or independent study. You could learn to be a coffee roaster on the job, for example, but hopefully not a dentist.
- Full financial disclosure. Respondents for the study agreed to disclose their income projection for the current year and actual income for at least the previous two years. Furthermore, they had to be willing to discuss income and expenses in specific terms.
- Fewer than five employees. For the most part, I was interested in unexpected or accidental entrepreneurs who deliberately chose to remain small. Many of the case studies are from businesses operated strictly by one person, which closely relates to the goal of personal freedom that so many respondents identified.
In sharing these stories, the goal is to provide a blueprint for freedom, a plan you can use to apply their lessons to your own escape plan.
Throughout the case studies, three lessons of micro-entrepreneurship emerge. We’ll focus on these lessons in various ways throughout the book.
Lesson 1: Convergence
As we’ll examine it, convergence represents the intersection between something you especially like to do or are good at doing (preferably both) and what other people are also interested in.
The easiest way to understand convergence is to think of it as the overlapping space between what you care about and what other people are willing to spend money on.
Consider these circles:
Not everything that you are passionate about or skilled in is interesting to the rest of the world, and not everything is marketable.
I can be very passionate about eating pizza, but no one is going to pay me to do it. Likewise, any individual person won’t be able to provide a solution to every problem or be interesting to everyone.
But in the overlap between the two circles, where passion or skill meets usefulness, a microbusiness built on freedom and value can thrive.
Lesson 2: Skill Transformation
To succeed in a business project, especially one you’re excited about, it helps to think carefully about all the skills you have that could be helpful to others and particularly about the combination of those skills.
Lesson 3: The Magic Formula
Bringing the first two ideas together, here is the not-so-secret recipe for microbusiness alchemy:
Passion or skill + usefulness = success
The Road Ahead: What We’ll Learn
In the quest for freedom, we’ll look at the nuts and bolts of building a microbusiness through the lens of those who have done it.
“The basics of starting a business are very simple; you don't need an MBA (keep the $60,000 tuition), venture capital, or even a detailed plan. You just need a product or service, a group of people willing to pay for it, and a way to get paid.”
This can be broken down as follows:
- Product or service: what you sell
- People willing to pay for it: your customers
- A way to get paid: how you’ll exchange a product or service for money
If you have a group of interested people but nothing to sell, you don’t have a business.
If you have something to sell but no one willing to buy it, you don’t have a business.
In both cases, without a clear and easy way for customers to pay for what you offer, you don’t have a business.
Put the three together, and congratulations - you’re now an entrepreneur.
These are the bare bones of any project; there’s no need to overcomplicate things.
But to look at it more closely, it helps to have an offer: a combination of product or service plus the messaging that makes a case to potential buyers.
The initial work can be a challenge, but after the typical business gets going, you can usually take a number of steps to ramp up sales and income - if you want to.
It helps to have a strategy of building interest and attracting attention, described here as hustling.
Six Steps to Getting Started Right Now
As we saw from the stories in Chapter 1, you don’t need a lot of money or special training to operate a business.
You just need a product or service, a group of people who want to buy it, and a way to get paid.
We’ll look at each of these things in more detail throughout the book, but you don’t have to wait to get started. Here are the six steps you need to take:
- Decide on your product or service.
- Set up a website, even a very basic one (you can get a free one from WordPress.org).
- Develop an offer (an offer is distinct from a product or service; see Chapter 7 for help).
- Ensure you have a way to get paid (get a free PayPal account to start).
- Announce your offer to the world (see Chapter 9 for more on this).
- Learn from steps 1 through 5, then repeat.
Personal comment: I wouldn't start with the product or service in mind, but instead follow an even simpler, proven 4 step process. Start with choosing a niche and the kind of people you want to serve, then set up shop / your website. If you start your online business as an affiliate marketer, you don't even have to worry about points 3 and 4 above. Instead - at this point - you can focus on driving (free) traffic to your website.
Please also check out these additional, free resources:
But What If I Fail?
Almost everyone we’ve met in the book so far has some kind of failure-to-success story.
In many cases, the story is about a product launch that fell flat, a partnership gone wrong, or the loss of motivation for the wrong project. “I tried something and it didn’t work out … but then I moved on to something else” is a common refrain.
All these stories are valid and interesting, but I’ve never heard a rise-from-the-ashes story quite as compelling as that of John T. Unger, a sculpture artist from a small town in Michigan. John’s story is a tour de force of failure and fear that turned into resilience and success.
As John tells it, the third best thing that ever happened to him was having the roof of his studio collapse from under him while he was standing on it, frantically trying to shovel snow.
The building was completely destroyed, and John spent the rest of the Michigan winter alternating between shivering while he worked and warming himself with an illegal unvented kerosene heater. It was a nightmare scenario, but then a funny thing happened:
The bank came out to assess the damage and gave him a $10,000 commission. John used the commission as a down payment on two buildings he had been trying to purchase for a while. “I don’t think the bank would have gone for the deal without the disaster,” he says. “It forced them to take a real look at my business instead of them just thinking of me as another broke artist.”
The second best thing that ever happened to John was losing his last day job as a graphic designer during the dot-com crash of 2000.
The loss of the job led to the loss of everything else - his income, his girlfriend, his apartment, and even a piece of his thumb in an accident incurred while he was moving out of the apartment.
While he was working the day job (seven days a week in 1999, seven days total in 2000), he also was working as much as ten hours a day on his art business.
After both of these experiences - losing the building and losing the day job - John was depressed and thought hard about what to do next.
His friends advised him to suck it up and find work wherever he could, but in rural Michigan those days, John knew that there wasn’t much work to be found.
It was now or never, so he stuck with his goal and continued making progress.
The best thing that ever happened to John, as he tells the story, was a late-night disagreement with a crazed cab driver, who pulled him into the back room of a diner and held a gun to his head for a full ten minutes, screaming and threatening to pull the trigger.
John finally escaped and walked out into another cold Michigan night, sweating, trembling, and glad to be alive. “I get it!” John yelled at the sky as he hobbled away. “I’m just so lucky!”
“You don’t really worry about the small things after that,” John says now. “Everything takes on a whole other level of meaning.”
“Your time is limited, so don't waste it living someone else’s life.”
The $100 Recap
Before we close it out, let’s look back at the key lessons of this book.
First and most important, the quest for personal freedom lies in the pursuit of value for others.
Get this right from the beginning and the rest will be much easier. Always ask, “How can I help people more?”
Borrowing money to start a business, or going into debt at all, is now completely optional. Like many of the people you met in this book, you can start your own microbusiness for $100 or less.
Focus relentlessly on the point of convergence between what you love to do and what other people are willing to pay for. Remember that most core needs are emotional: We want to be loved and affirmed. Relate your product or service to attractive benefits, not boring features.
If you’re good at one thing, you’re probably good at something else. Use the process of skill transformation to think about all the things you’re good at, not just the obvious ones.
Find out what people want, and find a way to give it to them. Give them the fish!
There is no consulting school. You can set up shop and charge for specialized help immediately. (Just remember to offer something specific and provide an easy way to get paid.)
Some business models are easier than others to start on a budget. Unless you have a compelling reason to do something different, think about how you can participate in the knowledge economy.
Action beats planning. Use the One-Page Business Plan and other quick-start guides to get under way without waiting.
Crafting an offer, hustling, and producing a launch event will generate much greater results than simply releasing your product or service to the world with no fanfare.
The first $1.26 is the hardest, so find a way to get your first sale as quickly as possible. Then work on improving the things that are working, while ignoring the things that aren’t.
By “franchising yourself” through partnerships, outsourcing, or creating a different business, you can be in more than one place at the same time.
Decide for yourself what kind of business you’d like to build. There’s nothing wrong with deliberately staying small (many of the subjects of our stories did exactly that) or scaling up in the right way.
It only gets better as you go along.
If you like what you read, please support the author and buy his book.
Thank you for reading and stay awesome,
Your Online Business Dude