Show notes from Episode #137 of the Sweaty Startup Podcast.
Thereís been great feedback and outreach from the ďBusinesses I LoveĒ post and podcast series, and we now have a few episodes with Jim Flannery taking a different approach. Jim and Nick hear a lot of ideas for businesses that typically donít lead to success, and theyíll discuss the difficulties here as well as how they would go about running these businesses if they had to.
This thought process–how to make any business succeed–is what you need to develop as an entrepreneur. Nick and Jim are always wondering how different businesses make money, and having that mindset will open up opportunities. Being able to think through customer segments, reaching customers, designing tests, evaluating results and wondering where youíre going wrong. Jim doesnít like any of these businesses, but someone smarter than him could make them successful.
Online Yoga Instruction and Remote Coaching
Nick and his wife were looking to find a yoga class, but nobody offers one early morning in Athens. Similarly, Jim just started following Yoga with Adriene on YouTube; Adriene started her channel in 2012 when there were few instructors online, so her quality content quickly gained her a mass following. Sheís now up to 6 million subscribers and getting hundreds of thousands of views overnight, so there is success to be found here.
Opportunity in Passion Projects
Nick normally steers people away from passion projects, but there is admittedly opportunity in them. While saturated, these markets have low-skilled competition and most entrepreneurs in the space donít know how to find customers and sell to them. Nick pictures a service where he can hire yoga instructors to lead one-on-one remote sessions on an hourly basis, while he takes care of the lead generation, sales, and logistics for these instructors.
Passion projects require an understanding of what customer segment can drive success for your business and supplement your income. The odds of living off of YouTube ad payments are slim, so you need to target the customers who are willing to pay for a high quality, differentiated service. This may be only 2% of your customer base.
Extending Your Services
This doesnít end with yoga either, Nick and Jim discuss the idea of targeting high school runners who have money and want to run for college. There are thousands of former collegiate runners who arenít able to monetize on the sport, and would jump on the opportunity to consult aspiring runners for $30/hour. They could meet virtually once a week, develop a training plan, review diet guidelines, and get updates on the runnerís progress.
Targeting the parents of wealthy families, especially if they want their child to perform in college, is a profitable market. Along with running, there are instrument lessons, tutoring, and other services that people will pay for to see success. Think of how much money is made in standardized test prep every year, and how that can translate to different services.
Stay Small and Narrow
Jim will tell you that people usually fail quickly because their customer segment is too broad of they invest too much in the initial infrastructure. Keep the infrastructure low by relying on a cheap web domain, emails, and Google Drive. To narrow your market, target a specific need more than an interest. With the running example, think about runners who need a scholarship to get into a good school. This isnít just trying to improve personal records, this is about their education and tuition bills.
To succeed with a passion project you need to be able target the right customers, sell to them, and differentiate your service. These arenít easy markets to succeed in, but with the low-skilled competition and available labor, there is opportunity for a well-run business.