How to Find & Evaluate Great Business Ideas | Robin & Jesper ✓ | Skillshare
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How to Find & Evaluate Great Business Ideas

teacher avatar Robin & Jesper ✓, Teaches Digital Marketing & Social Media

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Taught by industry leaders & working professionals
Topics include illustration, design, photography, and more

Watch this class and thousands more

Get unlimited access to every class
Taught by industry leaders & working professionals
Topics include illustration, design, photography, and more

Lessons in This Class

    • 1.

      Find & Evaluate Business Startup Ideas Introduction Skillshare

      0:41

    • 2.

      How Startups Succeed

      6:58

    • 3.

      How Ideas Are Born

      14:42

    • 4.

      5 Ways to Find Ideas

      21:07

    • 5.

      Capture & Active Inspiration

      13:52

    • 6.

      Your Unfair Advantage

      10:13

    • 7.

      Assignment - The Idea List

      2:09

    • 8.

      How to Evaluate Startup Ideas

      5:42

    • 9.

      Evaluate the Problem

      12:01

    • 10.

      Evaluate the Solution

      10:38

    • 11.

      Evaluate the Market

      9:12

    • 12.

      Calculate Your TAM

      15:08

    • 13.

      Calculate Your SAM

      10:01

    • 14.

      Calculate Your SOM

      7:01

    • 15.

      Evaluate the Competition

      13:59

    • 16.

      The Evaluation Checklist

      2:29

    • 17.

      Scalability

      9:28

    • 18.

      B2B vs B2C

      17:29

    • 19.

      Digital vs Physical

      10:04

    • 20.

      Service vs Product

      10:09

    • 21.

      Thank You!

      1:17

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About This Class

Are You Looking For The Next Big Business Idea?

Then, Welcome To The Find & Evaluate Great Business Startup Ideas Course.

In This Course, We'll Guide You Through Step by Step On How To Generate Business Startup Ideas With Huge Potential Of Becoming Something BIG.

While Other Courses Let You Sit & Generate Ideas Without Really Knowing The Market Opportunities, We'll Show You How To Know If It's Even Worth Your Time To Get Into That Market.

After This Course, You'll Be Able To

  • Find Business Startup Ideas That Has The Potential Of Becoming Something BIG.

  • Evaluate Business Ideas & See If You Can Make Money On Our Ideas & How Much We Can Expect to Be Making.

  • See If You Can Scale Your Business Idea & Understand Why Scaleability Is The Key Of Getting Rich.

  • Do Proper Market Calculations That'll Make Investors Trust In You & Your Ideas.

What You Will Master Inside This Course

1. To Generate Business Startup Ideas With Huge Potential
2. To Evaluate Business Ideas
3. To Evaluate Business Markets To See Opportunities
4. To Calculate Your Estimate Profits In a Certain Market
5. To Evaluate Competition To Find Opportunities In a Market
6. To See The Potential Of Scalability In Your Business Idea
7. To Understand If Your Business Startup Idea Is Worth Creating Digitally & Physically
8. To See If Your Business Idea Is Best Suited As a Service Or Product 

The Course includes:

Articles, Templates & Tools That'll Help to Maximize Your Business Startup Idea Generation & Evaluation Process!

The Majority Of The Tools In This Course Are For FREE and Will Help You Get Results.

Are You Ready to Start Find & Evaluate Your Next Successful Business Startup Idea?

See You Inside The Course.

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Robin & Jesper

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Robin & Jesper ✓

Teaches Digital Marketing & Social Media

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We're passionate about teaching! There's no greater joy than watching beautiful testimonials of people achieving their goals and dreams. That's why we STRONGLY believe in full and constant support. With ALL of our courses you can expect:

If you're interested in learning Digital Marketing - Social Media Marketing or Creating a Something Awesome..

We're at your service!

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Transcripts

1. Find & Evaluate Business Startup Ideas Introduction Skillshare: are you looking for the next great startup idea? If so, welcome. You've come to the right place. My name is Robin and my name is yes, but we put together They complete guide on finding on evaluating startup ideas. We'll show you how to find solutions to problems on de Valued if there's a profitable market for it. In other words, if people are willing to pay for your ideas now, coming up with ideas is easy. Finding great ideas is harder, but you only need one great idea to launch a successful startup business. This is the complete guide on how to find and evaluate startup business ideas. 2. How Startups Succeed: hi and welcome to the course. Now, before we deep dive into the course content, let's start off by laying the foundation and understanding what makes startups succeed. Let's dive into it now. In order to understand how startups succeed, we first need to look at why some startups fail and I have a very sad number to show you. And that is that 90% off startups fail. That's a very high number. And it's even more sad to understand why they feel no. CBS inside did some research on this, and they found that the number one reason why startups failed by far is that there is no market need for their product or service. And this is terrible. Because had they spent time laying down the foundations correctly, they would have seen when they did their evaluation for the market that there's no point in going further with producing a product for this idea. So what we're going to do in this entire court is that we're going to lay the proper foundations all the way from the beginning, and that very beginning starts off with learning how to find ideas. Now we're gonna go through the entire spectrum of looking at effective techniques off coming up with ideas off, managing to get a high number off ideas so that from all of those ideas we can get the great ideas, which is the end goal. And we're also going to look at some material and templates to help us along this way. Now, in this course, you'll find a lot of templates at your disposal that's going to help you not only come up with great ideas, but in the end was gonna help you save all of these great ideas down on a piece of paper. You're gonna notice that while it's easy to come up with ideas, not all ideas are great. Even the ideas that you thought were great from the beginning might not be. The only way to find out if an idea is great or not is to do the proper evaluation. So once were found on idea, we're gonna learn later on in the court how to evaluate ideas. And when we're looking at evaluating idea, we're looking at doing this very properly. We're gonna go from the very beginning and start by evaluating the problem now, asking questions such as if this really a problem is the problem worth solving? Then we're going to evaluate the solution, and we're gonna look at Is this actually solution? Or is it more a cool feature? Is it even a worthwhile solution? We're then gonna look at evaluating the market. And this is the very, very important part of so many startup. Miss Outta. If you don't evaluate your market, you're gonna spell possibly 1000. And if you're unlucky enough millions of dollars producing a product that no one wants. And sadly, there are some examples off that in the course off startups that went down that route and then went bankrupt just a couple of months later. So when were in value in the market, we're gonna look at doing proper calculations in order to see. Is Theis a scalable market? Is this a market I can get in to make money and overtime, make more money and you're also gonna learn how to find the correct information, find reliable sources and do the calculations from those reliable sources. So if you're going to be looking for investors for your startup ideas, well, then they're gonna be able to trust to invest in you and in your startup because one you have calculations show that, yes, this is gonna work and to you have reliable sources behind those calculations. That's very, very important. So we're going to spend quite a bit on learning how to properly evaluate the market, to make sure that we're not a part of those 90% of the failed startups. And finally, we need to evaluate the competition. We need to understand that the competition is a part of the market, and your competitors are also going to show you the way while also showing what the potential imitation off your product or service might be. Now, as you can imagine, this takes a little while. But what we're gonna do is we're gonna go through the lessons together, and once you've understood it, there's going to be a template waiting for a couple of lectures in, which means that you don't have to re watch these lectures whenever you want to do an evaluation for the problem, for the solution, the market or the competition, you can just grab this template. You can ride up, you're ready, and then you can check these off and you get a bird's view off seeing ISS this Ah, great idea or not, Dossett and valued well, is this a keeper or not? So there's gonna be quite a few templates in here to make your life much easier and make coming up with ideas and evaluating ideas much, much, much faster. And that is gonna be important because you want to come up with a lot of ideas to find great ideas to properly evaluations and then get started with your startup. Now, once we've done this, we're going to move on and we're going to do further evaluation of further evaluations means considering where do I want to go with my product or service? And also, what is it that I'm actually interested in? And am I looking at maximizing my rewards, but also my risk, or do when I go on more stable roots? So we're gonna look at scalability. First of all, not everyone is interested in scaling, but if you want to make a lot of money, scalability is a must. If you're happy with being a small start up and staying in that small scale, well, then that's not gonna matter. But for all of the business that's making a lot of money. Scalability is a must. So we're gonna deep dive into that and understand that part. And we're also gonna look at the difference between B to B and B to C. What's the difference between creating a product or service and selling it to other businesses or selling it to consumers? So there are some differences between these two markets. We're gonna learn them and you might have a preference. You'll find out after the lecture. Then we're gonna go through physical versus digital services or products. They're quite different. And we're also gonna learn about services versus products these air very different as well . So there's a lot of things to learn in this course and off to the course itself. You'll have the templates with you to help your when it comes to finding and evaluating your ideas. Now, finally, we need to understand that here were planning for profits, right? That means that when 90% of the other startups failed, we need to make sure that we make a proper plan before even starting a startup. To understand how we succeed, we Onley succeed would have started. If we can make it profitable, and the only way to find out if an idea is going to be profitable is to do the proper evaluation. So we're gonna learn early on to set the foundation plan for profitability, and then you'll be on your way. So we're very excited to have you with us in the course. And if you feel ready, we're going to move on to the next lecture, and we're going to start diving into learning how to find ideas, so I'll see in the next lecture. 3. How Ideas Are Born: hi and welcome back. Now, before we dive into the different methods in how to find great business startup ideas, we need to learn how ideas are bored, their basic formula in order to have a deeper understanding in how to cultivate great ideas . Let's dive into it. So every successful business out there is built on one great business start up idea. So we want to learn how to find those great ideas right, and in order to learn that we need to look at how ideas are made and how other successful companies have been cultivating them. So let's take a deeper look at how ideas are bored, and this is going to be a three step formula where most great business startup ideas are created from Step number one is finding a problem. Now, if you know of any successful business out there, I can tell you now already that that business is solving someone's problem. Someone is willing to pay money to that business to have their problems sold, so it stands to reason that in order for you to find a great start up idea, do you need for step one for it to be a great idea to find a problem, right? Step one, Find a problem. Now let's look at a couple of examples now. One of the most obvious examples are going to beat Google now. Google started office. A search engine. They're much more today, but they started off as his search engine, among other search engines. So the question is, how did they manage to stand out from the other search engines? While in order to understand this better, we need to understand that search engines back then were good When Google came out. They were great. So people were searching online for information. And while these other search engines provided good information, Google provided them with much more accurate information, accordingly, to what they were searching for. So if I was searching for, let's say, flashlights and then on other surgeons would pop up pictures of flashing lights or links to flashing lights rather than actually flashlights. I want to buy on actual flashlight. Then Google would have a much better system. We're gonna have a deeper looking just a second at how Google managed to do that. Now. Another example is tender, so dating is nothing new and matchmaking sites or nothing. You either. Right now, what tinder did differently is that they simplified it. Rather than going to a website and writing in a massive bio, you could go on tinder have a very simple version that is based on much fewer criterias. You could find someone that you like or dislike. And then you moved on again. They had competitors and we're gonna look at how they stood out from their competitors in just a second. But Tender found a problem and they sold it well, which is why there is biggest they are today. And then finally we have Airbnb now Airbnb. It's a fantastic solution because hotels have been around forever. But the problem with hotels is that they are expensive. Not everyone can afford them. So the creators over Airbnb noticed quite early on that Hey, I can't always afford a hotel, so they would pay money to live it somewhat their friends places. But the great business start up idea was born when people needed a place to stay and came to them, and they had three people who were willing to pay aided dollars each in order to live at their apartment, and then they noticed. Hey, this is a fantastic business idea, and we're not the only ones doing it. Other people are doing it as well. So what Airbnb did is that they took a phenomenon that already existed in a small scale, and they globalized it right? They made it into a thing into phenomena, and they could by that go ahead, head to head with the hotels and match them for the price and everything. So we're gonna take a deeper look at why they were successful in just eight seconds. So let's move on to step number two. Now it wants that number one is finding a problem. Step Number two is looking for opportunities now. Noticed that whenever you find a problem, you need to sold the problem as well. But there's a difference between solving a problem and looking for an opportunity. Let me demonstrate what I mean. So the company located Martin. They are an aerospace defence company. In other words, they work with the government with the army to help out with the defense systems that has to do with the air, and they also cooperate with NASA. So everything that has to do with defenses, and that is a rebound. That's basically their game. They work with advanced technology. So what Lockheed Martin was interested in? Was it the advice that would, for a person or in a certain area, stop gravity? In other words, they wanted to create the device that could make people levitate. Okay, so they teamed. That would not say in order to do this now, obviously, if you can make people levitate, the applications for that is basically endless. But let's just take, for example, a very common problem in hospitals, for example, is that people have been lying in hospital best for too long. They have something that's known as bad source. They get wounds from the pressure off, lying in bed for too long. If you could levitate people, well, that would be a problem off the past wouldn't be a problem anymore. So obviously the government would be very happy to fund in that the army would be that the world would be the applications would be endless. But the moral of the story is this is a great solution, but probably for you and me, it's not a great opportunity. Chances are we don't have the funds. We don't have the technology. We don't have the knowledge in order to drive this idea through. So that is the difference between finding a solution and finding a opportunity. So what? We're looking for our opportunities. This doesn't have to be perfect. Just a basic idea of Hey, I can actually go through with this idea later on in the courts. We're going to learn how to properly evaluate our idea so we don't need to go into that yet . But let's look at our previous examples once again. Now Google. We're looking for opportunities. And they did it really, really well. Now what? Google notice. What's that? While there were other search engines out there, the problem with those search engines what? That they were manually controlled. There were people who were doing the programming. So if I would go to their search engine, I would search for something in a result would pop up. But there was a person behind there who would decide which searches are going to get which results. And the problem with that was the first of all that was decently inaccurate. And it also took a very long time to get all the proper surge Choir is, so the system wasn't asked. Big ask Google made it now. What Google did was that instead of having people doing all this behind the scenes work, Google used algorithms. Now, algorithms made sure debated Indian employees to do this, and they would effective eyes that the work much, much more, meaning that a lot more work a lot more Search choir is could be handled in much, much, much less time, while also creating a system that decided on which pages should rank high in Google's. That meant that, hey, ah, lot of people are actually searching for the keep area, for example, So Wikipedia is going to rank high a system that the other search engines weren't using. So Google completely revolutionized this system. They completely changed the idea of the function off search engines. So once again, this was Google's opportunity. Search engines. They work, but they weren't effective. The opportunity was to make the properly effective, and that is how the group now today Google is more than just a search engine. But that is how they started. Now let's look a tinder asked. Well, now for the matchmaking website. There's a lot of different criterias to feeling a lot of different information about yourself and usually on those websites. The people who are they have a massive bio. You know, people who are young today who are like 18 and in their early twenties you shall have a short attention spawned in their older generation. So the problem with that is that that is not an interesting approach for them. So what tender did was that they took the matchmaking system and they severely simplified it. Right? So tender is based on just three simple things. It is your location, your age and your looks. That's it. And then you get to decide if you like the person or you don't like the person extremely intuitive. And the idea was born from the creator noticing that, hey, people having a difficult time approaching each other because they aren't sure if the approach is going to be appreciated. If you go and make a move on someone, they might not appreciate that. But if two people are liking each other, it's for sure going to be appreciated. So they improved the idea off a match dot com system on online dating service, while also making real life dating much more easy. Because anyone can use these three criterias and like or dislike someone genius off a system. And next up, we have Airbnb. Well, the idea here was globalization because this phenomenon was already happening. People were renting out their apartments, their rooms, their houses and people were paying money for it, and people were receiving money for it. But it wasn't a phenomenon yet. Right hotel dot com, for example, or hotels that come. They have already made it into a thing where they could collect a bunch of different hotels . And then you can search in the area for where you need to the hotel, and then it would show up in the search results. Well, Airbnb did the very same thing with this phenomenon of renting out your apartment or your house in your room and just made it global. Because of Watson Global. There wasn't a system in place where they made up a system in place for it, and that was their opportunity. All right, so moving on to step number three that is going to be right down. Your idea and you need to write it down when you have found a problem and you have found an opportunity within that problem. Hey, you already have on idea, right? But the problem is, if you don't write down your idea, that idea is going to get lost, and you're gonna come up with a lot of idea. Not all of them are going to be great. I promise you that. But you're gonna have a lot of ideas nevertheless, and you only need one great idea to get your profitable business up and running. So always write down your there. Get into the habit of doing that. This matter. If it's a pen or paper, a post it note or if you do it on your mobile, I do to my mobile. Now let's take a deeper look at ideas. We understand the formula off, how they're bored, find a problem. You find an opportunity within that problem, and then you write it down. And that is how an idea is born, right? Doesn't guarantee that is going to be a great idea. We're gonna learn how to value the that later on. But now we know how ideas are born. Let's look at what ideas actually are. Well, ideas is nothing new. Really. Let me quote Steve jobs on this now. Steve Jobs used to say creativity is just connecting things. In other words, you take what you already know and you connected with something else you already know. And then you have an idea. You have something. You This is the basic tenants Often idea, right? You take stuff you already know when you combine it. Let's take a deeper look at this. So what Google did was nothing. You write the tube algorithms and systems and combined that with a search engine. All right. They combined those two and then you made Google. And at that sign, we already had Alta Vista. We already had Yahoo. They were search engines, but they didn't have these other part which waas the algorithms and which was the systems. If you were born in the early nineties like I am, you might actually remember using AltaVista or Yahoo. So you take two things that you already know. You combine them, you get something. You now similarly tinder was just like that as well. Now what they did was that they took dating services and they simplified it. I mean, basically, they just took the service, the idea, the execution, everything, but made it much, much, much more simple. So the idea was simplification. And here you have the dating service. You combine that you get something new, and then you got tinder fantastic. And there is already matched up. Come out there and e harmony. And I can tell you match dot com has been around for at least 20 years more than tinder has . But tender is already a bigger service than mashed up. Come are at least the numbers that I check last time might be different today, though, but that's what I check last. So you take something, you know, combine it with something else. You know, you get a completely new idea, and that is how ideas and great ideas are bored. And finally, this look at Airbnb. Well, what happened? You already have the idea off renting out your place, right? People are all the renting out their house, their apartment at the room. Whatever. So they took that idea to get it with globalizing at her sanity of globalization. Put those together and Airbnb was bored, and once again you already had hotels that Comey already had booking dot com. But this was something new. This was something different and hugely successful and appreciated. And finally, I want to end this. But seeing that, please make sure that you develop the habit off, creating, finding and riding down your ideas. What I mean with this is that it's very, very easy to find ideas, and you're going to get a lot of ideas. It's more difficult to find great ideas. So what do you need to do in order to find the great idea is come up with a lot of ideas. Now, if you find 10 ideas per day at the end of the week, you're gonna have 70 ideas. There's a lot of the ideas when you only need one great idea to have a great start up and be running a successful business. So make sure that you develop the habit off, cultivating ideas off, riding down your idea, and then we're gonna move on to the next lecture and look at a couple of techniques in order to more accurately and more effectively and actively fine those great ideas those gold nugget and especially just finding ideas over all the great ideas will come with them , see in the next lecture. 4. 5 Ways to Find Ideas: Welcome back in this lecture. We're going to learn five very effective ways or finding ideas. No. Remember what we spoke about earlier in order to find those gold nuggets, Those great ideas we need to raise the numbers we need to go through. Ah, lot of ideas because most of the ideas aren't going to be good. But when you do find your great ideas, that's where you have your startup, and that's where you have your profitable business. So let's learn some of the most effective ways of finding those ideas and get started. Let's dive into it. So let's look at the five most effective ways of finding ideas. Now, you're gonna need an idea to get your start up in your business up and running, and you're going to need a couple of different perspectives in order to generate ideas. We know the formula already. Now we need to know the approach to actually generate the ideas, and the 1st 1 starts with your mindset, and that is becoming observance. Now becoming observant is going to be your key in becoming creative, and finally, those great ideas among all of your ideas. Now being observant means looking around at the world, it means to look at your friends. Look at your family. What are their problems? What are their complaint? In what aspect? Off your own life or the bottlenecks? No, A bottleneck is where everything is floating except, you know, at the bottle off a flask where everything, it's choked off in the flow. Now, if you have a bottleneck in your life, you might want to have an idea on a solution to the bottom like and that might be your profitable startup, right? That might be your great idea. So become observant and take that mindset with you in your everyday life and in the following techniques that we're going to be going through. So let's look at the second way and remembering the observant part, always keeping that with us. Now. The second way to find ideas, which is my favorite and I believe is one of the most effective is looking at what bothers you right now looking at your own life and understand that, Hey, they're probably going to be something that bothers you. And if not, I about to you, that is amazing. But most mortal people are going to have something that bothers them. Why does it bother you? And how could you sold that? Now? Let's look at a couple of examples. Once again. Tinder was one of those great examples. Now Tender said, Hey, meeting people and getting dates, it's actually quite a struggle. Now, I don't dare to approach people because I'm so afraid of rejection. I don't I don't know if that's gonna be appreciated. And I don't want to go online and write these massive buyers and wait for someone to contact me or contact someone online. So what am I to do? Well, tinder sold that right and made this super short and effective interface. You could find the person you like them. You don't like them. Oh, we matched. Hey, you want to meet up where you start chatting, etcetera? Luke, get what bothers you. Similarly, Airbnb. If you're out traveling and you notice that hey, hotels a really, really expensive there's a solution to that and people are already doing it. Why not globalize it and make a system out of it and make money from it were similarly, I have this spare room. Why not rent it? Someone who needs it, or there's gonna be other people who do it. Why not globalize that? So, once again, what bothers you are the spare room is just there. And I need money or I want to or need to travel. But I can't afford my living. And here are the solution. And the solutions became the idea that became too started. That became a profitable business. But it doesn't have to be this big. It could be the mundane things. This well, for example. Hey, where did I put my keys? Most likely you have forgotten your keys somewhere is one of the most common problems in the world in my experience. So again, there are solutions to that. And there spent people ahead of us who have thought, Hey, people are losing their keys. Why not create a key finder? And that is how simply can be to come up with ideas and get some great ideas and get your startup. Okay, So look at what bothers you and start generating ideas from there. Okay, Well, I don't know where put my key, so I need to create the key finder. So how would a key finder work so that's where this processing starts. We're gonna talk more about that later on in the valuation. But it's at the very least as an idea. It is a fantastic concept. I lose my keys a lot. I need to create a key finder. That would be a great idea. Now, next up is finding inefficiencies, and this is exactly what Google did. Now Google looked at the already existing search engines that were out there and thought, Hey, you know, they work, but they just aren't that good. So what they wouldn't need is to improve their results. So people are searching for things, but they're not always getting good results. How could I make sure they get good results? So they made a system that is more efficient. They started using algorithms and they started using their own page ranking system perfect if only inefficiencies. They feel that they corrected, and then they grew beyond the other search engines. Now, similarly, if we look at the key finder, that is a fantastic idea. But it does come with its flaws as well. Now imagine you're gonna first of all, need to keep the key final with you. That's an extra a part that you need to bring with you that you might lose as well. So that's gonna be a problem. And a lot of key finding work by the way of sound. What if you lost them very far away? Or what? If you have a cat that every time you used to keep finding, get so scared jumps up and all of your flowers And you know all of your ceramics and porcelain falls to the floor because your cat got scared, so that would be an actual problem. If you have the problem, chances are other people have that problem too. So what could you do then? Well, that would be an inefficiency. How could you improve it? Well, most people are carrying their cell phone with them everywhere, right? And also, the cell phone doesn't need to make any noise. And you don't need to bring anything extra with you, because chances are you're gonna have your cell phone on you already. So putting a GPS on your keys and then using yourself on Astor Jeez, GPS and tracking your keys. That might be a solution. And we actually found on inefficiency on someone else. a solution again. We're already taking things we know and things that exist. Combining that and coming up with something new. So if you take a look at this list already that we have these three different ways in order to even find this sort of solution, you need to become observant off. What are the issues for me for others? And how could I sold that even better. And what bothers you? Hey, I found the key finding, but I don't think it's good enough. I could make it better that made you find in efficiencies, right? And then you created this product. We came up with this idea So a lot of these different ways to find out here, at times you're going to melt into each other as well. But the number one becoming observant is still going to stand. The test of time are still going to be your ground staple, if you will. If you're not observant, you're gonna have a lot of ideas. Just go over your head. Now, another company that did this really good is Transferwise. If you don't know what Transferwise is, is basically an international bank. So two of the biggest problem that people have with banks is one. They have a lot of hidden fees. And two, if you are a traveler, well, then being bound to one bank is going to be costly and quite a bother and being ineffective , I would know I travel a lot myself and I use Transferwise. So what Transferwise did then is that first of all, they made all off the fees. Transparent. So you know exactly how much you're paying while you're paying everything. And that in itself is unique. And secondly, they created a unique concept that made an international bank meaning you have different currencies in one single place. So instead of having, for example, Swedish American, a British bank, you could have won a Euro currency and one bank. You could have a U. S. Dollar in one bag, so we just scrolling one bag. It's center. So if you're traveling, you could do two conversions yourself. Genius idea. They found the inefficiencies in the previous banks might have been something that actually bothered them, or they were observant enough to see that other people had a problem with this and they sold it. So that was their idea. It was a great idea. Now there are massively successful business. And again another company is doing this so well is Tesler. Now if you don't know Tesla or you don't know the name Elon Musk. He is someone who is very futuristic. He is someone who is speaking about this company. Tesla specific. He's looking to remove the dependency on fossil fuels because first of all is destroying the planet. The Secondly, we're running out of it. So he wanted to change things up, and he wanted to make sure that we could create card that instead of being fueled by fossils, they were going to be fuelled by electricity. Right. And this brings us to the next point past well or in the fourth Way, which is looking at futuristic trends. Now test lays one of those companies that's completely riding on this concept, and they're doing a fantastic job. So if we once again are to combine all of these, if you are observant enough, you can notice what's bothering. You are bothering others or bothering the planet. Find inefficiencies. Hey, we're gonna run out of this fuel eventually anyway. And it's not very effective if We're looking to sustain the planet. And you know what? Technology is something that's on uprise, electricity, gadgets, something that's on operas, electric cars that might just be the next big hit. He created this company, and it is very successful. It's had its ups and downs, definitely. But more on that later in the evaluation part because this man created his very old market . We're going to be talking about markets more later on. But needless to say, futuristic trends that is going to be a key. You can jump onto a upcoming trend and build something up. Find those inefficiencies early on and use that idea to build your startup. You have got it made already. Another great futuristic trend is Amazon's Alexa. So we know already that CD, for example, on Apple's they've been around for a while, but voice search and voice marketing is really taken off with Amazon. Alexa. You can start ordering things through just talking with this speaker Alexa. Similarly, I think Google's released a similar product now where you can talk to the speaker and you can order things online. And this is massive because this means that people are searching differently and that means that people are marketing differently. So once again, this is a futuristic trend. What does this mean for you? What? What is bothering you was gonna bother others. What are the inefficiencies with these? And if you're observant enough, you might just notice all of these problems and come up with a solution. Maybe there's a problem with the distance. Maybe there's a problem with the competition. Maybe there's the accuracy and maybe have a solution for any of this. And maybe that is going to gather your next idea Now, looking at futuristic trends, there's a very easy way to find what is on the uprise, so you can start generating some ideas from it. Let me show you how to find those trends. All we need to do is go to trends that Google that come and gonna put this in. The resource is, and then you search for whatever it is that you want to search for eso. If I want to search for something that I think it might be an upcoming trend like out on the equals gonna search for that and then I'm going to make sure I like to keep it in the United States because a lot of things, especially when it comes to technology, happens in the States. It's goes very fast. It's very big, and they're very consumer minded. So I like to put it on states and then this one change from past 12 months and change from 2000 and four to present, and here we can see if they they reconsider its a very big trend going on. That's just completely on the uprise. So if you have any ideas of autonomous vehicles, I don't that's really not my niche. Then you could really have something made here, because that is something that is growing as we can see on the trend now on autonomous vehicle. By the way, it's vehicles that are gonna learn how to drive themselves. Hence the name Autonomous. So another thing you might want to search for that I know, or at least I think, is on our praise. Mushy learning. No machine learning is basically computers who learned to interpret data and make decisions from that data, so computers are becoming more and more human, right, so machine learning is how they interpret data and take decisions that we can see here is where it is on the up price. If you have any background within I to your programming, were any knowledge within machine learning? Well, focus off your efforts there because as we can see, the trend is growing. And if you can ride the trend, you've got it made. I'm pretty sure that within the coming 2030 years, maybe even just to coming 10 years, we're going to see a big bunch off electric cars. But Tesla is still going to be in the forefront because they started early and they took over the market early on. And that's the benefit of writing this futuristic trends. Let's head back. And finally you're gonna want to cook the what works. This is the fifth way. It's one of the most common ways is also one of the most effective ways by coping what works? I mean, literally copy what works and apply any off the above ways onto that concept. Let me show you what I mean. So take Google, for example. What did they do? Well, they looked at the inefficiencies off Alta Vista off Yahoo and noticed that Hey, we can copy what they're doing and just do it better. We're just gonna add a role algorithms and at her own system, right, because that is their weakness. That is their flaw. Well, funny enough, another company did the same thing with Google. Now they're called Duck Duck Go. So they noticed that, Hey, Google's great search engine and they had their algorithms and everything. But they're not very privacy friendly, right? So Google save solo for information our cookers are tracking in order to give us a great experience in order to help the marketers and benefit blah blah by this deep in process. And what Dr Goh said is, that's all great for that purpose. But if I just want to search something and not be track, that's terrible. So they took Google's concept with all of their algorithms and all of their systems in place and just added in the privacy part, right, So that's another way of coping what work and then finding that inefficiency and adding it in. But there's different ways. You can copy what works as well. So take once again tinder, for example, this is the classic tinder interface you can like, or you can this like something could swipe in between different people. Well, another company decided to take the very nice and easy concept off tinder the simple interface and the like what it's like and added to animals and adoption. So all past is a company that has adopted this concept for adoption, so you can swipe through different animals and then decide if you want to adopt them or not . But the idea and the interface pretty much completely taken from tender but adopted for a different niche. So you can copy what work and just adopted elsewhere, once again, just connecting things right. Hey, we have tinder Hey, let's added in for animals instead for adoption instead of dates, you have something completely new. It's a fantastic way to go about it. And then we have a different company who copied them or write off. Now this common is called coffee over bagels. On what they did, they pretty much took the entire idea of tinder. But while this is still about dating, the added in different features such as a bigger bio shat rooms, etcetera. So the idea of tender was to simplify. Now coffee over bagel city instead went the other direction and made it a little bit more detailed, and that seemed to work for that least audience. So, as you can see, there are different ways of copying now. Coffee over bagels. They are more direct in their copying. But while all passed, it just completely applied it on a different meats and more apply the interface and copy that were there many different ways of coping. And we see this everywhere. We already know about Amazon. My chances are you have ordered from there at some point. Amazon is the biggest e commerce in the world if they're massive. 15 years later, after Amazon had been released, all the express came to the market owned by a company called Ali Baba Group. And if you know Alibaba, you know you can buy from that stores was a little bit different, But all the Express and Amazon are now the two biggest e commerce is on the planet, and their concept is pretty much exactly the same. So even though it was 15 years later, all the express still managed to take the very same concept and grow massive. The only difference here is the marketplace where they are. So while Amazon is in the west of the US, all the express is in the eastern is in China. So you could copy something and just apply to a different location and get a different result. Let me show you how different it can be and how different the results can be just by applying it to a different location. So look here. For example, uber. If you know about uber, you already know that it's a concept that has made the taxes system more effective. So there are a couple of problems with taxes already. We know that can be really expensive. The taxi meter. You don't know how much you're gonna pay and you don't exactly know where they're going. Well, uber has sold all of that. You know how much you're gonna pay. You know, when they're going to pick you up. You know where they're going. You can see on the map. Basically, they found inefficiencies. They made it better. No waiting lines, etcetera. Well, interestingly, uber was created in the West 10 later on came grab right in Asia. So grab is pretty much exactly like uber. It is a service where you can file for private people who do a taxi service, you get to see you how much you get to pay. There's no window or a minimal waiting time, and also you get the map. To see we're gonna go very safe is very effective. But it's pretty much the same thing with a different name in a different location, and that is the key here. So while uber was created in the West in the US, I believe Grab, though, was created in Asia. So they just completely took the very same concept, put it there, and it became hugely successful. So your location is important. It depends on how you take over that very market. So then, later on, uber released another feature called Uber Eats, which means that those private drivers who were doing the service could now go and pick up your food and deliver it to you. Well, what grab did was that they cope it. That could be that as well, and it's called grab food. The only difference is that grab is in Asia, right? That's the only difference. And then, as uber expanded to Asia, well, Grab had already taken over that market so good that they actually bought up uber in Asia. And now grab owns uber there, and they close it up, took all of those employees and people working and put them into grab. So while we have uber, that is the biggest company in the West we have grabbed that is in Asia. And the idea here, the concept that they just copied pretty much everything straight off. But because they were in a different location, they got good result. They could own the market, and it turned out to be a great idea. All right, so these are the five different ways to find ideas. Remember, everything starts with becoming observant If you're not observant. If you spend your days searching for information on your phone, which is fantastic, we need information. But you forget to look around what people are doing, what people are thinking, the problems people are facing and talking to them. You're gonna miss out on the most obvious solutions off all. And those obvious solutions might just be your next great startup business idea. So I hope this sponsor of great ideas in your mind already what the very least some ideas. Now remember, if you can write down 10 ideas per day, well, that means that at the end of the week you'll have 70 ideas in just one of those might be a great idea. And there might be unique start of business idea. Great job. So let's dive deeper into the whole aspect off ideas, and I'll see you in the next lecture. 5. Capture & Active Inspiration: Welcome back in this lecture, we're going to learn how to capture on activity inspiration. Now, in the previous lecture, you learn some active ways to generate ideas. Now, in this lecture, we're going to look at more passive ways to rather more lifestyle choices that you can make in order to increase your chances of having that light bulb moment that ah ha were. Everything just falls into place. Let's look deeper into that. Now, the lightbulb moment is that oh so gracious and also wanted moment that every entrepreneur is looking for when you go, Erica. Ah ha. I got it to some problem you've had or something that you've been wandering most of the time or is at least in your position right now that is going to be about your business start up idea. So we're going to look at how to maximize this event to be occurring so inspiration can come into Wasik income as a sudden event. But inspiration can also be a state. It stayed you want to be in, especially when you're doing this work. So we're going to look at how to maximize that. And the first way is to keep a pen and paper by your bed. Now, I've got some pretty incredible things to tell you here already. Now, first of all, the suing machine is done. Wanderers worldwide. And thanks to it, we have some pretty nice clothes and it can be mass produced. And baseness were based off it. Elias Howe created this sewing machine from a dream. Now, that's right. So he had a problem he was trying to sold. Couldn't really figure out how to solve it. But in a dream where he was captured by natives somehow when they were trying to poke him with despairs, it gave him a light bulb moment of how you could attached to a machine. And when he woke up, he noted it down and he created a suing machine. This is why I always recommended to keep a pen and paper by your bed or yourself on a swell . But we're gonna talk more about that in a second now. Similarly, Einstein's relativity theory came to him in a dream. He was sliding down a slope, and suddenly he was shut out towards the start and he had this light bulb moment would probably look more information in his luggage and I have where he just connected things and he could create. It's real activity theory. E equals M seats square again. Dreams are have a huge potential for inspirations and creating great ideas. And finally, we have the periodic table now demented Amanda Levitt had been working furiously for three days in order to understand how to place the different elements. So when he went to sleep at night to give his mind some rest, that's where he dreamed the order off the elements. And when he woke up, he noted it all down. He put it into practice, and it all fit. And it is the way it is today, thanks to him, noting down his dream. And it's sudden life, bold moments now. Further than that, if that was an inspiring in itself enough now Bar clays, which is a the financial service companies, did some research, and they noted that more than heart off, all small and medium sized business owners have had some great ideas coming from their dreams. So it's very, very worthwhile to make sure that you keep pen and paper by your bed and remember, when you wake up when you've had that inspiring dream, a light bulb or, you know, just on idea, maybe it's even a bad idea, but it is an idea. Nevertheless, don't make sudden movements. If you make sudden movements, your dream recall is going to disappear. Keep the pen and paper close to your bed, A grab it and ride it up, even if it is in the dark, and then you can move a little bit and then fine ride it. If you move too much, you're going to lose the dream recall, and you might just lose that idea. You dreamt off. Now next up goes a little bit hand in hand, what we just spoke about and that is taking naps. Now. We already know that sleeping is an incredible source of potential creativity and inspiration, but naps even more so now the reason that napping is so powerful has to do with the way that naps work, especially versus our normal long time sleep at night. Now, when we take naps, we enter something known asked Rem sleep. Now Rem sleep is when we dream in this when we're at our creative state and if we look at this chart. You can see that in the beginning off our sleep. We have a lot of what's called stage 123 and four sleep and those air just deep. Sleep, right? We're not, We may dream, but it's very rare. This would dream they're not especially creative. States were just dreaming. But the longer at night that we sleep, the longer the rim period becomes. This create the beautiful period with the potential to give us inspiration and creative ideas. So when you have walking up in the morning and you go ahead and you take a nap, you are going to have that entire nap to be one long ramp period, because you've already done your deep sleep for the night. So all that's left if you taken up is REM sleep and REM sleep is highly creative. Rem sleep is the stuff where Einstein got his idea. Elias Ho and Dimitri Mendeleev. So it is the state you want to be when you're napping, when you want to get ideas and just a tip for you. If you're going to be taking that's and implement them into your life, which I recommend you do. Even Google does it for their employees. Then if you have a busy day or you need to stay alert, take a 25 minute nap. But if you have a lot of time off, you can take 1.5 hours nap. The reason for that is if you sleep in between 50 60 70 minutes, you're gonna wake up in the middle of a sleeping cycle, and that is going to get you drowsy and drowsy is not productive, right? So choose between 25 minutes or 90 minutes. Now next up is meditation. Meditation is a really great way to get inspired. A famous spiritual teacher named ECA, Tollett say's stillness is where creativity and solutions to problems are found. Now granted, his entire business is founded on these principles. He's gonna be by it, but it is worth noting that it Cartola has a network off 70 million dollars right now, when he has built up that huge will based on something as abstract as stillness and presents. So obviously he doesn't know a thing or two about business, so it is worth listening to now. The great benefit with meditation is that it allows us to enter these greed states off inspiration and creativity. Now, if we look at a chart hair off how our brain waves work, we can see that there are four different main states. There are more before our purpose. These are the four more, most important to know. Now, the most common state that we are in is known as a bit of state. That's when we are alert. I'm in a better state right now. You know, there's a lot of thinking processes going on. We need to have good thinking processes going on. When we go through everyday life. It is how we function. It is an effective way to be, but it is not a very creative state to be so. While a dysfunctional, it is not very creative. Now the other state would do spend a lot of timing is no Mr Delta stage. And that is when we're sleeping. And we're doing the stages one. Before that, we looked at before REM sleep. The creative sleep where Einstein, Elias and the meat they had their creative ideas is not Delta stage. They were not in Delta sleep, So these are our most common states, but where the magic happens is in between. It is known as the alpha and the theta states. Right. And we have access these states many times already. If you've never heard about this stays in my comments a surprise. But when we take naps, we go into fair, not waves. Right, that is the rim. Sleep up and talk about it is a very relaxed You are sleeping state where you're highly creative. When we meditate, we enter an alpha state. The difference there is that we're going to be more awake, more alert, and we can function while still being very creative in in a inspired state. So it is a very functional state where stada is not a functional state. So in order to effectively use meditation to enter an alpha state, what I recommend you do is used Any form of meditation such as mindfulness in salt's gonna help you to become more observant. Remember, from the previous lecture or a focus meditation such as simply focusing on your breath on the recent we're doing this is to enter these new state. And in this new state is were inspiration. Calm. It is when your neurons in your brain cells start making connections. And we already know from Steve Jobs quote right that creativity or ideas is nothing new. It's just connecting things you already know. And that is what your brain is doing when you are entering the all for the fed estate. So that is where we want to be in order to get her inspiration and to get our ideas. Now there is another way we can go about this. That is, to use something known as by neural beats. No, by nure. Obese is basically when you get one tone, it is an audio entrainment is when you use one tone in here and once own here and he used different tones. So, for example, if you use 15 hurts here and 10 hertz here, that means that there's a difference off five hertz and then those five hertz is gonna put you in a certain state. Now, you don't need to fully understand that that is not important. But what it means is the final robe is allows you to enter one of these creative states at will, and that is going to be very handing. No matter how we look at it, you could combine that you could take a nap while also listening to buy new release to enhance the state you can meditate with by neural beats as well. And finding by normal beats is very easy. Let me show you exactly how to do that for free. All you need to do is go to YouTube. Come and search for beina RL beat and then whatever it is that you want to be listening to . So, for example, if you want to be in an awful state, which is the creative states functionally inspiring state you search for all finals, assert for creativity. If you only serve for all, you might get a pure tone a little bored. Research for creativity sometimes add music so all of these are gonna work. And this is a great state to be if you're doing work on your computer, if you're sitting down brainstorming or trying to jump down some ideas or using any off the previously mentioned techniques in order to generate more ideas, right. So YouTube is a great free source where you can use these. Do you want to use some more high quality by neural bees? You can go to buy neural bees. Meditation dot com Just search for the Alfa Bun. You're obese, and by them I think they're like $7. You don't need these the slightly higher quality should you enjoy them. I've been using by neural beats where I think over 12 years now I love them. I use them. But again, they do exist for free. Here on YouTube's, you're completely fine. Just using those. Now let's head back. And finally we have changing your environment, and this is such a classic. But it stood the test of time and changing your environment could be anything it could be. For example, go for a walk. If you've been inside all day and you've been trying to solve a problem, which you can, we'll take a walk in the forest. There's a completely different environment already, and that is going to change the way you think, and that's gonna allow your brain to make new connections. All we're doing here is helping our brain become mawr. Creative finances, inspiring state and make new connections is all about making this new connections. Whether it's conscious or unconsciously changing your environment could also mean that you take different walks walk in different place. We usually don't. You could go to a different cafe. You don't usually or whatever it is where you're working or trying to take a break, do it somewhere differently or do it in a different way. Changing things up allows your brain to make new connections and new connections we know are good. So to end this lecture, these are not a substitute for the different idea generating methods that we learned in the previous lecture. We need to use that we need to be active to pursue our this, and I recommend that you generate 10 new ideas every day, at least for the first couple of weeks to get the hang of these. But this is a way to help in a more passive way to get in on inspired state and stay there and help you find a Enrica moment that ah ha moment. So keep pen and paper by your bed. Do it. You could use your phone absolutely. But I find that waking up to that light kind of distracts me and helps me forget my dreams . I prefer pen and paper, but whatever works for you take naps, even if it's not every day. Just take naps. They're not a waste of time to rejuvenate an extremely creative and inspiring meditate. Same there. It's not a waste of time. It helps you not only with the mental help with the inspiration, the creativity, use it. Enter the right state. You want to be in a reap the benefits used by neural bees. If you enjoy them. I do. You know where to find them on YouTube and change your environment. Do different things. Visit different places. Watch art. If you're not on artsy person, tried going to a museum. You'll be surprised how many new connections your brain is forced to make used these different tips and then let's move on to the next lecture in the course, See you there. 6. Your Unfair Advantage: Hi again in this lecture, you're gonna learn how to use your unfair advantage to come up with some really, possibly great ideas. So what is your unfair advantage? Well, your unfair advantage is your background. It is your expertise that you haven't Other people don't. Well, there's gonna be others in your area as well. But we're gonna use this to combine it with other ideas, other niches. To give you an advantage based on your background. Let me show you what I mean with this. Let's dive in. So here we are. Now we're going to be looking at your advantages, and we're gonna learn how to use them to come up with some great ideas. Now, off course, If you've been playing music, let's say you've been singing for 15 years and I haven't been singing. And we're gonna go into a singing competition together, or a karaoke A Well, you are going to be shining, and I am going to be standing in the back in all now. Similarly, we're going to use the background. We have our expertise, our background, our interest, etcetera, looking at what we know and combine it with something else that we know. Remember, that is how you create something, how you come up with ideas. So in order to do this the most effectively, I've prepared a couple of pdf's for you that you can simply grab them, print them out and then start feeling them in. But before you do that, follow along in this lecture and I'll show you how to use them and how to properly God. You're advance to come up with ideas. So first of all, Step One is what is your expertise? There's an entire page dedicated to this. So your expertise is going to be basically your previous jobs, your interest, whatever backgrounds you have, whatever that you are knowledgeable in, for whatever reason, right that up and try to fill in at least 10 different things. If you can't, if you only come up with 345 or six, that is absolutely fine. But try to come up with 10 different things, and remember, this is based on your background, whatever that is you're gonna have an advantage in because you have more knowledge about it . That's the first step to feeling that page. Now this second step is to find 10 different niches and these 10 different needs is you're gonna feel up in the next page and they could be anything. Now there's a couple of different ways to find. Each is you could look around you could use, you know, from your mind what you already know. But if you find all of these difficult, there's another way as well we could use a random niche generator. Now, I'm gonna put this generator in the resource is. But before I do that, let me show you how it works. Now, it's very, very simple. It is in these your el re toolbar that come forward slash niche generator is gonna be in the resource is and all you do is that you go ahead and you click on, get another niche just like this and you're gonna have a niche pop up. So it's a fantastic way. Did you start feeling out you initially with 10 different niches. So instead of, you know, sitting around thinking about it forever, you could have it in pretty much an instant. You can come up with some really creative ideas using this. So that's all there is to it, literally at the press of a button, you get a different niche. Let's head back. So once you found your 10 niches, simply move on to the next step, which is also the next page, which is where you combine them. Now. Combining them is very simple. You fill out your expertise in this paper, you fill out your knees and then you're gonna have a new idea. And the reason that we have three different papers for this is so that you can come up with a lot of different ideas, right? So, as you can tell, there is only a space for 10 combined ideas in here. But on your paper, if you have 10 different expertise is and you have 10 different niches well, that's already possibly at least 100 combinations right there. So you're probably gonna want to print out quite a few off these papers. That's how we do it at the very least. So by combining them, it allows you to come up with some really cool new ideas. Let me show you how this works by doing it myself. Now, in order to do this, I used one of my expertise is which is from being a personal trainer. I used to work in the fitness industry for a couple of years, so I wrote that under expertise. Next up, I did go to the needs generator and I simply generated something and I got acoustic guitars , right? So my idea was to create acoustic guitar for big hands or even just big people. Now there's a lot of very big people in the fitness industry who can't get into normal clothes and would have some issues coming around. The normal gets are similar. There's going to be people with really big hands who might have issues plucking the strings unless you want to play with applique them. But let's say that you want to play with your fingers only you might design a specific acoustic guitar for that now. Similarly, I also rode the bad backs because, from my experience is a personal trainer. Ah, lot of people have bad backs, and the interesting thing with that is that I know from playing guitar did. When you sit and you play guitar, you're quite often hunched over, and the problem with being hunched over is that it can aggravate your back problem so What if I could come up with a sign that allowed you to be more upright to still play your guitar might just be a guitarist and might be a different seal to carry the guitar in, or maybe a different guitar design. But that was my idea now to give another example. Clearly, I do have an expertise and a background within marketing and also in business, which is why we're doing this course and the other courses. So I wrote up marketing and the niche that I got from the randomness generator was pilat this equipment. So my idea was to sell the use Pallotti's equipment. Now let's say that I do my evaluation, which is going to be laid drawn in the course, and I noticed that there's quite a demand for it. There's not that many competitors. This is actually really cool idea. I might as well do what the guy stayed at Airbnb. I might take a phenomenon that already exists. Let's say that people are already buying use Pallotti's equipment and make it into a more global phenomenon, a global scale, and make a system for where people can go in and find Pallotti's equipment and buy in there and it's gonna be used to is going to be fresh, cheaper price, right? So that way we can actually tackle our competitors. Who would be selling new Pallotti's equipment? Similarly, how Airbnb tackled the hotels. So this is just some possible ideas. So used this paper and fill out all 10. You can come up with some really, really cool ideas by doing this, and you're also gonna have different perspectives because it's going to be your background , the more you know more possible combinations you can create. Now, next up, I want to talk about more effective ways that you can be using that you can also be using it to deepen the nation's. So let's say that you find something that you think is really cool, Like for example, I know it is that, hey, adapting guitars or at least instruments for people with big hands or just bigger people might actually be a thing. So I'm gonna do the 10 niches for, Let's say, different instruments. So I would write up 10 different instruments and see, Is this idea going to apply for extra large people, for example, Maybe you cally lease and the easiest thing to play if you are a very large person. For examples, that might also be a new idea to use. So you can, deep in the niches when you feel that you found something that is interesting or did you want to dive deep cream? And this is just generating more and more ideas for you to in the end, move on late during the course and evaluate with So you want to come up with a lot of ideas so that you can find those great ideas those gold nuggets. And finally, I want to talk about widening your perspective. Now the great benefit of doing this exercise is because you're going to have a unique perspective on this, because is your background your knowledge and you're gonna have a lot of knowledge and it's You can have very interesting perspectives, but you also need to remember to make it wider and look at it from different angles. Now let me give you an example to what I mean with this. So if we bring up the paper that I did and I did the marketing right, so marketing the nature's Pilatus equipment and the idea was to sell the use Pilatus equipment. So what I looked at What? How do I use marketing in order to somehow use Pallotti's equipment and make a thing out of it? Well, if you can market Pilatus equipment well, you can see maybe find a different needs, such as use Pallotti's equipment. You can sell it on a big scale that would be using the skill marketing to my advantage. But it would do this one more time, and we feel in marketing with Elin Pilatus equipment instead of looking and marketing. It's a skill we could also look at the people doing the marketing. That would be the market tres So what would be the benefit for marketers? Well, maybe you could look a pillock tous for marketers. Now there's a lot of agencies. There is a lot off market companies out there now. What is going to be there big issues where it's going to be there big pains in their bodies in their mind, Then is there going to be a Pilatus for that? Well, if the reason, if there isn't find it evaluated, and if it's possible to make a big deal out of it create a brand around, create a business around it, and there's your idea right there. So there's a lot of different angles that we can use in order to get ideas. How can I use marketing? What about not just the skill marketing? What about marketers? What are the markets is problem. Whatever a lot this equipment. Can I sell it in a global scale? Or do actual people doing marketing need the political equipment themselves? So why didn't your perspective try to use many different angle and come up with some great idea and fill out a lot of these listener Great exercise. Now let's move on to the next lecture when we're gonna talk about this assignment that you're gonna need before we move on in this court and start evaluating all of the ideas. It's great job following along this far. See in the next lecture 7. Assignment - The Idea List: hi again. First of all, great job and making it this far in the course. Now we've learned a lot of things already. We have learned how ideas are born. We understand that, First of all, we need to find a problem. Look for the opportunity and them right, that idea down. Right? And then we've learned five very effective ways. In order to find more ideas, we have learned different ways to get inspiring, to get inspired and to be creative. We have understood how to use our unfair advantage to our actual advantage. And there's we already know a great deal of ways to generate ideas. Now, before we can move on in the course, we need to actually have on idea least all right. And we've spoken about becoming observant and developing the habit off, writing down and coming up with ideas. Well, here we are. And if it hasn't started already, it needs to start right now. And for this for special occasions, we have something known as the idealised. It's nothing fancy, but it is something for you to print out, and the idea is very simple. Right down. 10 ideas. Now, if you don't have any ideas that at least feel one off these out before you move on in the course, because we're going to move on and start evaluating our ideas and to have something to evaluate. You're going to need ideas. But I recommend that you print out at least 30 of these because if you can feel a one of these a day and that's gonna be 10 new ideas every day for 30 days, that's 300 new ideas. And that is perfect because that teaches us to become observant. And it developed the habit off inventing. Remember, we need to rack up the numbers if we want to find great ideas. We need to start with just developing ideas, coming up with ideas, combining things we already know into something you in great ideas, will come. So print this one out, fill it up so that you have a minimum off 10 ideas with you before we move on in the court . And once you do well, then congratulations. You've already got some idea. Let's start evaluating them. See in the next lecture 8. How to Evaluate Startup Ideas: hi and welcome to the next section off the course. And in this entire section, we're going to learn how to properly evaluate startup ideas. Now, before you move on into this course, I hope that you have brought at least 10 ideas with you. If so, great job. We're gonna learn how to properly evaluate and see it's an idea Or is it a great idea? And it's gonna work for a startup s a start up idea. Now, before we do that, let's have a quick overview and see what we're gonna learn and how we actually evaluate on idea. So let's get started. And let's have a look at what separates a great startup idea from a bad one and how you should know which one to pick from your least or from your many possible upcoming lists. So, first of all, the first question we need to ask yourself, Is it really on opportunity now? If you remember the idea formula, how ideas are born, we understand If we first need to find a problem, then look for an opportunity and then write that sound. Now, The second part is always the big question of Hey, I found an opportunity. But is it really an opportunity? So the entire evaluation process is going to be asking that question? Is it actually an opportunity, or did it just look like that? So the next question is, how do we then find out if it actually is? Yes, it is a good opportunity or No, this is actually not an opportunity at all. Well, that's gonna be from these common questions where we evaluates things such as the problem itself. Now, the question we need to ask is Is this actually a problem worth solving those? The problem occur frequently enough for someone to care? Or is it a big enough problem that people are actually willing to pay money to have its soul? Right. So we need to evaluate that, and we're gonna look more in that how to properly evaluate that part because not every problem is worth solving. And if the problem isn't worth soldiering, well, then it's not going to be a great start up idea. And next up we have the solution. Same thing here. Is it actually a great solution. And when it comes to solution, a couple of questions we need to ask yourself in one. Is it unique? Does it actually solve the problem in a good way? And this is unique And it's the side. And two, it's It's something that you can actually protect that is yours, or is it already in the open space and being used? So we're gonna have a more in depth look at what makes a great solution. And what are the kind of solutions that you want to stay away from more in depth and next up, I want to look at the market. Now the market is so important to understand, because if you got no market, well, then you're not gonna have a good start up. And then your idea isn't a good opportunity, adult. So how do we understand a good market? Well, we need to look at the day that is already out there. So, for example, if we understand that we have an idea that we think it's a really good start up idea and we look at the market and see Hey, the market from the data that's available shows that it's worth $10 million right? And we from our research understanding Hey, we could probably get a 10% slice off that if we were to be successful with the startup, well, then we can understand. Also to 10% of those $10 million is gonna be $1 million. So the potential earning four year starter would be $1 million then we can compare that. Okay, How big of an ambition am I going to need? What kind of capital do any? What kind of funding do I need? Etcetera. But we need to understand the market is through a demand for it. How much am I going to be able to earn and based on how much am I going to be able to earn ? How much am I going to be asking from possible funders so more about that in death in an upcoming lecture? Now, next up? We also want to look at the competition, and when it comes to competition, there are different ways that you can look at it. First, we can see that Hey, there's no competition that might actually be a warning. Some. Why send someone else doing this? Chances are, people might have tried it and failed, but it can also be the other way around. A ton of people are doing it, but then again, that's gonna make it difficult, because the competition is going to be so big. So do we want little competition or do we want a lot of competition? It's not going to be black or white. It seldom is when it comes to start ups and great ideas. But what we do need to understand is the different variables and the different factors that we need to look at to understand. Hey, is the competition something that I can actually get into? How doesn't match with the market? How doesn't match with the solution? Is my solution unique enough compared to the competitors on? What about the problem? Is enough people even experiencing the problem in comparison to the competition that it's actually out there? So there's a lot of different faxes that we're going to look at in order to evaluate what it's a great start of idea. Then we're also going to look Maurin depth the things such as scalability, sustainability, what about things such as a digital versus a physical product and there's going to be a lot of different services versus products What are the difference between doing it be to be versus B two c etcetera? All of this is going to end up in our evaluation off the ideas in order to see, he said, a great startup idea or not. So this is a very exciting section. There's a lot to learn. Ah, lot of information to just soak up like a sponge. So what I recommend you do is make sure that you have at least 10 ideas with you, and then I'll see you in the next lecture and we'll get started by looking at the actual problem, see in the next lecture. 9. Evaluate the Problem: welcome back. So this is going to be the first step in our evaluation. Now, if you remember from the very beginning we learned how great ideas are born and the first step in there is finding a problem. So extends to reason that the first thing that we need to evaluate here is going to be the problem. So let's get started. Step number one Evaluating the problem. Let's get started. So in order to do some proper evaluation, we're going to do it in four steps that we went through in the previous lecture. And the first step is evaluating the problem itself. So we're going to start often doing that by asking a couple of very important questions about the problem that you have found. But before we do that, there's a couple of important pointers that we need to look at, and the 1st 1 is that you need to learn and understand that the focus needs to be on the customer's. Here's a very important tip now, this start of giant Steve Blank says in a start up. No facts exist inside the building on Lee opinions, and that is a part of the problem adding and somewhat volatile nature off startups. They are pretty uncertain, but they have, ah, high risk and a high potential win. But a problem off that is that we have lack of facts. It's all about opinions. So in order to ensure that we do a proper evaluation, the more opinions we have, the better when it comes to focusing on customers. What you can do is investigate the problem by doing your research, asking around that, more importantly, used to Internet because you get access to a much wider amount of information in a shorter time. Googling surfing around on Reddit, checking out similar products on Amazon of reading those reviews and finding what are people saying about this potential problem. So that would be the first thing to do now. Second up is understanding nature and the difference between a problem and the feature, right? So we are looking to Seoul some sort of problem and not just adding on additional cool feature, because that simply isn't going to sell and be a successful startup. Let me show you a great example for this. So here's a product called a new me intelligent toilet with cooler connect So what it is is that it's basically a very fancy toilet that can play music for you. That's voice control that connect your Spotify list. It allows you to flush it simply by walking away from it and it can warm. It's seed up it simply by using voice command. Now, these are all pretty cool things right now. What is not so cool is when you think about the fact that most people don't have an issue with actually clicking on the flash or pulling down the flush part on the toilet. However, your toilet works. So this works more as an additional cool feature than it actually solved the problem. And here's the next kicker. The toilet itself cost $8000. Now, had you invented a way where you can make toilets flush themselves for, say, $5 Well, then that might be a more viable option, because you might actually be solving a problem with germs here. But here we actually aren't. We're just adding in a cool feature that's going to cost us $8000. So this is where we understand. Is there a real problem going on here, or are we just adding on additional feature. So it's very important that we do a distinction in between here, and then we start looking at the additional questions. Question number one is. Is it problematic enough? Now the question is asking. Is the problem actually worth solving? And in order to understand this, let's look at a couple of examples now. Example Number one Here is a company called No More Wolf. What they've done is that they have created Send source that you put on your dog that reads their brain waves pattern from your brain wave patterns. You can start understanding your dog, and hence you can communicate with your dog. Or rather, your dog can communicate with you. That is the idea, at least, and this product goes for between $65 to $1200 depending on what sort of product you have. Simple product can only recognize two different behaviors, while the more fancy product can redeem or behaviors. So the problem here is that it's not problematic enough. No, most people has a dog. They at some level understand they dog, they know their behavior. They know what they want usually, and those who don't go to a dog train or they learn dog psychology now putting sensors on your dog and then trying to read his brain pattern and understand your dog through that there is just not going to be a market for the That's just not a problem that most dog owners have. I've never heard someone say, Oh, I wish that I could translate what my dog was trying to tell me most of the same. If you own a dog, you already know some basic communications with your dog. So this is one of those products. Where is the problem? Problematic enough? I would say no, it probably isn't. And while the company still exist today and still is selling, the product is going to be interesting to see if they can actually maintain being a business because a lot of example that we're going to be looking at they've already crashed . And for very obvious reasons as well. Under Stap now the next example is juice zero. Now you might even have heard of this one. So very interesting products. So what it is, it's basically a juice machine that sells for $400. So what problem this seduced machines sold well. People who like juices right and they want don't want to spend the time doing it themselves . There's a pretty cool idea. Well, the problem with the juicer Oh, is that the Jews is actually in those packages that you're seeing on the picture here now. So all this $400 machine does is that it opens the package. That's not very problematic. Often event right. You could just buy these packages open and my poor them in and there's your juice. So for the question, is it problematic enough? Do you need a machine that opens packages for you for $400? Probably not end. They have gone bankrupt a couple of years ago, I believe, and for pretty obvious reasons, it's just waas not worth. It's just not problematic enough right now. Let's take a good example here, and a good example is Airbnb. So if you're traveling around and you need a place to stay, but you don't have that much money well, Airbnb souls that but allowing you or globalizing rather so that you can rent someone's apartment for a cheap or some or you can have your apartment rent. Is that problematic? Is a problematic. People travel and need somewhere cheap to stage. Yes, that is a big problem. I think it stands to reason to say and similarly, that people need money and have space in their house. Is that something or problem that people are facing? Well, yes, they can already name friends who are in that situation. So, yes, Airbnb has a very cool, very good solution. So the first question we always need to ask yourself is. Is it problematic enough? It's the problem actually worth solving. Now let's look at the next problem here. Is it a common problem now? If it's not a common problem, then chances are no one is going to be interested in buying it right. If it is a common problem, well, then you've got a market. Let's look at a couple of examples once again. Now here is a product known as I smell, and what it is is Basically it's that a prototype of apparatus with that you connect to your computer and the generous different types of smells, and the idea was to add in an experience to using your computer's. Certain websites are going to have surgery, smells and the I smell supposedly had hundreds of different smells connected to it. Pretty interesting concept, right? And this souls for between 50 and $200 depending on how many smells he had program needed. Now the problem here is that the I smell doesn't solve a problem, and it's most certainly not a problem that a lot of people have now. One thing that it does that is very cool is that if you are browsing apart fume store, for example, you could actually get a hint off those perfumes. But that comes back to the question. Is that a common problem that people have the people serve? Or rather, is still a lot of people who serve perfume stores and then asked himself, And I really wish there was like, a prototype that allowed me to smell This melts right now probably exists, but is it common? It is not, but here is at yet another kicker. This prototype raised over $20 million to be developed and released, but it crashed pretty quickly because no one cared. It didnt solve a problem. No one wanted it, so we always need to evaluate the problem itself and do proper evaluation off our entire ideas. Now, if the startup idea isn't a great idea, then there's no point in investing time and money into because not going to give you a result. Worst case scenario. Actually gonna lose a ton of money. So do the evaluations properly. Now let's look at a good example here. Now losing your keys is there are a lot of people who lose their keys. Yeah, is that a problem? Is a common problem? Definitely is. The question is, does it affect people's lives? Sometimes it does, because you can lose your keys while you're already late. You're going to be even more late than it happens frequently enough. That is really going to be bothering a lot of people. Some people lose your keys once or multiple times a day, even just a couple of times a week is enough for it to be problematic? Well, there were people out there who evaluated the problem, came up with a solution and made a lot of money off that solution. So you need to make sure Easter problem a common problem because if there's not a lot of people to experience it. Well, then you don't have a lot of buyers. So make sure that it is a problem that is common among all of the people and also realize the difference that sometimes is going to be a global phenomenon like most people lose their keys right. A lot of people in the world use keys, but sometimes it's just going to be within a niche. But then make sure that the people within the niche all share that problem, that it is common within that niche. And then the final question, which is one of the most important questions in my opinion, that is, would you pay to have it faced and if so, how much? Now the final question How much is not important? That's more getting an estimate off. What is the estimated value of this? We're going to realize that as we go further on in the evaluation, when we look at things such as the market, but just for now, what would you pay to have it fixed and just abstract Lee or by a him about how much it's going to give you some good estimates because if you're not willing to pay to have this problem fixed. Chances are other people might not be either. So it's just another great question to stimulate the mind. And C is the problem actually problematic enough is the problem. Come on enough. And would you pay to have it fixed? Would others pay to have it fixed? And if so, how much? So go back. Look at these three questions. Go through them carefully with your ideas. You should have at least 10 ideas by now and try to single out is see if any of those ideas actually go through to the next phase of the evaluation. Remember, we're just evaluating the problem right now. In the next lecture, we're going to look at evaluating the solution and then we're going to evaluate the market , and then we're going to value your competitors, and I'm gonna finally give you a check list so you can run through this procedure quite quickly. So go ahead and look at your ideal is look at these different question and see if any of your ideas passes on to the next lecture. If so, great. If not, well, you need to come up with more ideas. I recommend trying to generate 10 ideas a day. But regardless, let's move on to the next lecture and look at how to evaluate solutions, see in the next lecture. 10. Evaluate the Solution: welcome back. So you've evaluated the problem, and with some luck you might even have somebody to pull through to the next round to this round. But we're going to be evaluating the solution, so let's get started. So as we move on in the valuation, things get increasingly more exciting and evaluating the solution. There's some very important steps that we need to pay attention to, and we're gonna go through one of the most primary rules that we always need to keep in mind when we are evaluating, especially when we are evaluating our solution, and that is to stay objective. Staying objective is so incredibly important because there's something known as the confirmation bias that is, you've come up with a solution great. And now you started getting attached to your solution. And that's problematic because you might have a pretty poor solution or one that actually isn't going to be working out in the long run for a start up. But you might be so attached to it that you wanted to work out, and you start looking for reasons why it should work. This is very detrimental if you want to come up with some great startup ideas and execute them. So what I recommend is to the best of your knowledge, stay ASA scientists. There's a saying in the start of community that people are usual like lawyers, that is, that people are so willing to defend their point of view and their solutions and their inventions. But what people actually do need to be its scientists being objective and looking at the day that it is available and making a reasonable decision which goes into the next very important point, that is, use common sense. Now. I know using common sense isn't exciting. It's not. Creative is not while, but you've had your created and wild aside already when you were inventing the ideas and that is great. That is how through all of the ideas we come up with great ideas. But now we need to take a step back and properly valued by using common sense, maybe have some really wild thoughts and really wild solution. But hey, let's look at it. Is that really going to work? So stay objective, put on the common stands glasses, and then let's move on and look at the questions. If we're going to ask in order to properly evaluate our solution, and the first question is going to be Is it actually a solution? Now? You might be surprised at a lot of the time of solution isn't actually a solution. Once again, it could be a feature, or it might just be, you know, what would be deemed as art or just a prototype for a product. But it might not actually be a solution at all. Let's look at a couple of examples now. Here's the first example off what someone would call art. Now I couldn't find the company that created it because he, from my understanding it went bankrupt so long ago. But here is a prototype with the started by. There was actually to put your garbage within this plastic, making it more artsy. And needless to say, that is not actually a solution to anything that is just taking garbage and making it into I don't know, mortgage garbage or putting garbage in plastic. And now we have non environmental friendly garbage. So this isn't a solution. This doesn't solve anything. This doesn't make a lot of sense, right? Using our common sense here. Now here's another very interesting solution that isn't the solution at all, and you might not see it properly on the screen. But actually down there, what those are is that they are different recycling bins. Yes, that is right. These air, different things for different types of recycling on your computer doesn't make any sense whatsoever. And creating this kind of product doesn't make sense to anyone will. Once again, I don't think that this worked out very well, so I couldn't even find the name off the company here. But it stands to reason that this isn't actually a solution. Now let's look at an actual solution, and that is tender. So what was the problem? Well, the problem was that it's so hard to get a date. A lot of people really struggle with that. Or do you need to go online? Fill out this big bios and it's It's a complicated on a hard process. What did tend to do? Well, they made it industry it forward and a very easy process. So it's that actually a solution? Well, yeah, it is, especially when you're afraid of approaching someone because you don't know if they appreciate you approaching them But if you both have liked each other, your in the safe. So so it's tender. A solution. If the solution is to make dating simpler and you think dating is hard, yes, it is. So. First of all, take a good, hard objective look using your common sense at your solution right now and then ask yourself, Is it actually a solution, or are you just hoping for it to be a solution? And if it is, we ask the next question, Which is, Is it unique now? Your solution needs to be unique, and that is because even though as we've seen in previous examples, you can have a lot of competitors who are copying others. But they always adding something or to make something unique or make something different, because otherwise there's no reason to choose your product. Schuster a service whatever it is that your startup is offering, so we need to make sure that it is unique. So again we stay objective and we ask, is it actually unique? So let's look at a couple of examples. The 1st 1 is washboard, and what washboard does it that they sold the problem that people have that they don't have enough quarters for doing their laundry right? That's actually a thing, especially if you are in America. I mean Europe. That's not a problem for me. So the problem is that there's not enough quarters for people who want to do the laundry. So what washboard did was that they did a monthly service where each month they would send them $20 in quarters so that they could do their laundry. What's the kicker? Well, the service costs 26 $99. So you're actually losing out money by doing this. So is the idea unique? Well, you're doing kind of fate transaction. Just switching out money here, kind of borderline. I mean, it's not a completely non unique idea. Does have some originality, but it's very poorly executed because even if it would be deemed unique, this is not a good solution. Now switching money between people has been happening forever. But you don't want to lose money while you do that. So even if this unique might doesn't have to mean that it is a good idea. But the idea is still needs to be unique. Let's look at some more examples. And that is Doc. Doc, you go If you remember what Dr Go is, they are a search engine. The focus on your privacy is that something that is unique? Well, when they created their businesses definitely Waas, Alta Vista wasn't on the market. You who was in the market Yahoo search that it. And then Google came and completely took over that with their unique algorithms and systems . But then, doctor, go look that they're inefficient. System said, Hey, what about people who want to stay anonymous online? Who wants their privacy? So they created a search engine and they added something unique. They added in privacy. Is that unique? Yes, because that at the time didn't exist. There are similar services now today, but at the time there was a very unique. So always look at your solution and ask, Is it unique? That doesn't guarantee that it is a good solution, but it does guarantee that it holds on water. If it is and then and next up, is it sustainable? Now? Sustainability is going to be very important in your solution because if we take an example as Web ban now, weapon is a very cool company that in the nineties had the idea that, hey, people are using the Internet, Why not make sure so that people can order stuff such as the groceries online and we can deliver it to them? Right? That's very cool This way ahead of their time. Now the problem is actually that they were way ahead of their time. So back then, I think only about 20% off. The people, at least in the UK, were using the Internet. And in order to execute this idea here, to buy a big bunch of computers yet by officers he had by vans and then put this business into operation, there's a lot of cost going in there. While the demand for this because of what so new at the time wasn't big enough, so he went bankrupt with the idea of Web. Now there's very unfortunate because the day we have like Wal Mart, we have Amazon who focus hard or making this come through, and it is actually coming through because the demand is huge. So at the time it wasn't sustainable because we need the market wasn't there, But today it's a very sustainable ideas. We need to look at the solution and say it's a sustainable. Am I going to need so much capital than I will be able to earn in order for this to make sense? And then finally, let's look at a good example. In a really good example is Spotify now? Where Web Van lost out was that they needed to pay a lot more than they were. Resource is to actually get paid back. For Spotify has a very, very sustainable model. They have two different revenue models going on here, and one there is a free service going on. It's Spotify where you can listen to the music for free, but then they'll be using advertising within their service. So basically they'll earn money through the advertising so they can make money and the artists can make money or two. You can use the premium service, which means that you're paying a monthly subscription fee. And that also means that you can use all of their services, all of their songs in there. And then Spotify makes her money. And while Spotify makes demand, we can also pay off the artist. Now this is a very sustainable model. It's called the subscription model is definitely not unique today, but he's very sustainable and what we're looking at our sustainable solutions, right? Similarly, as we're gonna talk about later on in the course, if you have physical products, there's going to be more limitations than if you have digital products, for example, because it's not gonna be a sustainable when it comes to scaling. But more about that later on in the course. So to summarize, in order to properly evaluate our solution, we need to first of all, make sure that we stay objective and second of all, use common sense. These kind of go hand in hand. And then we asked three questions. One. Is it actually a solution? And two, if it's unique, it needs to be unique and need to be different from your competitors. And three, is it sustainable? If it's not sustainable, well, you're not going to have a sustainable startup either, and then you're not gonna have a business. Make sure all of these three fit in. So if you have any idea that's pulling through so far and moves on to the next round, the next evaluation that's great. If you don't that's completely fine to we're here to learn. That is why we generate so many ideas so that the great ideas can come through from all of the numbers. All right, so I'll see in the next lecture where we're gonna learn how to evaluate the market. See in the next lecture. 11. Evaluate the Market: welcome back. So in this lecture, we're going to move on with our evaluation, and we're going to learn how to evaluate the market or the potential market. Now, evaluating the market isn't necessarily the easiest thing to do. But don't worry about understanding everything right away, because in the next lecture we're going to take a deeper look at it and see how to do some proper calculations. So for now, let's familiarize ourselves with the different terms and understand, from a bird's view, how we look at evaluating the market itself. Let's dive into it. So while evaluating the market has a lot of different variables to it, and we don't always know those different variables. We can do some pretty solid estimates, at the very least, and we're gonna learn how to do those here in order to God. If the idea we have is a great start up idea, because in order for your idea to be a great idea, it doesn't need to feed a market. So let's move on and start evaluating the market. Now we're going to be familiarizing ourselves for a couple of new terms, and we're going to look at a practical example of how we can look at what the total market is, what markets were going to be serving and what share that we can potentially get from that market. And it's going to look like this the diagram that we're going to be using. But don't worry about it. We're gonna break it down bit by bit. So starting up the first thing we have is called a total addressable market, also known as a tam. Now a total addressable market. As you can see in the gray area here, that's the entire market, this entire value off the entire market. So, for example, if I were to sell acoustic guitar than this, the total addressable market would be the music market, right? So to give you a live example, let's say that I am going to be selling guitars, right? So I am looking at the total addressable market for that, and I have been able to find the total value for the total addressable market simply by Googling and look at the different articles and finding a reliable source and the value off the music industry. It's a 19.1 billion right now. Okay, so that is the total addressable market. So if you are in, for example, the taxi industry, you need to look at the entire transportation industry. Okay, so moving on, the next thing we need to look at is this served available market, and that is going to be in the blue area on the diagram here and the served available market. This we're getting to our niche right and the need for us would be selling. Guitars were selling acoustic guitars rather, so that is going to be a certain percentage off the total addressable market. And I looked this up as well and the only way to find these kind of values are estimated values, which you are is to go online to find them, which is why these are all estimates because there are no actual exact numbers for this. So the number that I am getting for the served available market, which is guitars we said 1.4 to $1 billion right, so we know that this would be in the market that we could potentially get into, and if we had a monopoly for this market, then we could own the entire market and we would have a value of one point for the one billion, but because we don't have a monopoly on guitars, unfortunately, there would be great for business. We're gonna have to share some of that that is known as a share off market and this our business and our idea wants to get in and get a share off all of that's total available market right known as a share off market. And that is the green that you can see on the diagram. So this is where it gets a little bit tricky and in order to fully understand what are potential share of market is we need to do some calculations and I'm gonna show you in the next lecture how to do those calculations. But for now, let's say that, and we estimate that we have the possibility to gain 5% off the served available market. That would be 5% off the total purchases off the total income off the guitar industry, so that would account to 70.5 $1,000,000 so that would be our potential annual revenue. These are all calculated annually. Okay, so that means the total addressable market is a 19.1 billion annual dollar value, so our potential share of market would be $70.5 million. For now, just familiarize yourself with the concept off total addressable market, known as a tam served available market known, They say Sam and the share off market known as A. Some I know they all sound like characters from Lord of the Ring, but they are just concept that we need to understand. We're gonna go more in depth about this in the upcoming lecture in the very next lecture. Now, what does make a good market? There are two criterias that takes a start of idea into the market into really potentially great market that makes it integrated idea, and one off those criterias is quickly growing new markets. Now, if you can get into a quickly growing new market, you can really elevate the speed off your growth and you can get a huge card of the shared is just going to grow exponentially with time. So, for example, we know that machine learning is something that's really up on the right because we went to Google trends and we could see that Hey, there's something that's becoming increasingly popular. So if you were to get into that market right now in today, that would mean that in the future you could really ride that wave. Similarly, the way the Tesla and Elon Musk is doing right now, the future chances start is going to be a lot more electric cars. And Tesla is going to be the leader in the industry that all of the majority of the market and they're going to look to defend that market. Meanwhile, there would be more consumers and more money and more value. You see how this is all leading up to one conclusion, right? So the next criteria for a great market for your idea would be your ability to disrupt the market. Then, when I'm in, disrupt the market is that you could go into a market that actually isn't growing this already very established, such as the taxi industry. But you could destruct it the very same way that uber did so. What uber did was that it looked at the inefficiencies of the taxi business and the transportation services overall, such as the taxi meters unreliable. You never know about the tanneries, you know know if they're going to the correct location, the waiting times or sometimes terrible, etcetera. And even in some places of the world you had a taxi company, a sign to your location or to your state, and that would be a problem. Like because then they had a monopoly, and they didn't care about customer service Well, needless to say, Gruber found this inefficiencies, and they could really destruct the market by offering much better services to lower prices as well. So being able to disrupt an already existing market, it's a great market that you're really going to want to get into, but also understand that when you're destructing a market, you're potentially adding in more variables to the calculation. Because when uber went into the market, they didn't just destruct for taxes. They also disrupted for buses. They also the destructions for limousine services and even car rentals, because uber could replace all of these services very differently. So that also means that when you're looking at the surged available market, it grows potentially bigger because now we're not looking at the taxi service. We're looking at the bus services well, the limousine and the car leasing services. So we're going to dive deeper into the actual calculations in the upcoming lecture. For now, let's have a quick recap and understand that the total addressable market is going to be the market overall. So for Herber, that would be the transportation. And for us selling the guitars in this case, there would be the music industry. That's the total addressable market. Second off, we have this served available market, and that is where we put in our needs to what the market through. We are actually looking to, sir, right? And for us, in this case, that was the guitar needs for uber. Well, that's gonna be a combination of all these things. But you could primarily look at, for example, the taxi industry. And then finally, we're looking at the share off market, the share that we're looking to get from this Earth available market. So if we can get 5% and we already have a some, we have an estimate of how much we could potentially earn when we know how much we could potential annually earn. We know about what would be a good investment or to ask for venture capital, etcetera so what we are looking to do in the next lecture is learned proper calculation. And remember, the two criterias for a great market is going to be a critically growing new market where you can ride that wave and getting quickly establish yourself as a leader in the Newmarket and secondly, your ability to destruct a an already existing market. That would be the other very available option. For example, the way that uber did you come up with something new, which allows you to get a share often already existing market. So if this is confusing to you, don't worry about if we're going to dive deep printed and clarify it further in the upcoming lecture. So for now, just understand Tom, Sam and some the Lord of the Ring characters, and I'll see you in the next lecture. 12. Calculate Your TAM: Hi and welcome back. Now, if you felt like things went a little fast in the previous lecture, don't worry about it. We're gonna break them down one by one, so we can get a deeper understanding of why we need them, how they're useful and most importantly, how they work. So let's start off and dive ride into tam. So here we are. And we're going to be talking about a total addressable market, also sometimes known as a total available market. But they're the same thing and they're called the town. So what we need to do is to do some calculations. Now, What we did in the previous lecture was look at some rough numbers, but those rough numbers aren't going to be working out in the real world. And the only thing that's really going to be interesting for us is things that work and things that are applicable in the real world because we're actually going to do a start up , right? We're gonna find ideas for a start of evaluate them, and then hopefully we're gonna do our startup. So we need to find and do things that work now, starting off, why do we need a tam. Well, we need attempt to ask, says or growth potential. Now, if we don't assessed their growth potential, we might notice that Hey, there's a very small market for the idea that I have right now and it's just not worth getting into Or we might notice that, Hey, this actual, a great market is also very scalable market to enter. So that is gonna be great. If you're looking to find some investors. You really need to show that there is a great market out there and you are doing the right thing by investing in the start up in this idea. So we really need to calculate or timeto understand the growth potential, offer potential. Start up with this idea. Now let's dive into the needy, greedy a little bit more off the total available market and how to look at it. The first thing that we need to do in tow understand, is that we need to find the correct market now. I'm not talking about changing our idea to change the market. What I'm talking about is the calculations that will be doing We need to do the calculations on the correct market now in the previous example. Remember when we looked at the total available market? We looked at the music industry because we were going to be selling guitars, and we'll found out that the music industry had an estimated TAM off 19.1 billion, right? There was a total value off the music industry. Well, the problem with that is that that is not going to be your applicable town. That isn't your time at all. Because if you're selling, for example, guitars, well, you can't apply that to the entire music industry. There's going to be a record. Deals live, shows different instruments. And not all of those guitar sales are applicable in there so that it's not your total available market. That is simply the value off the music industry. So the question, of course, is Well, how do I find out the total available market Well, that is what we're gonna dive into right now and do some actual calculations. So let's say, for example, that we have come up with a great idea and we're going to be selling Plec trims. If you don't know what appliqued um is, it is what you use in order to play on the guitar to hit strings with. And let's say that we're going to be selling this plankton for $5 now. You might see here already that it's quite unreasonable to think that, Hey, I'm going to sell this $5 Plec trim and the total addressable market that I have is a 19.1 billion value worth. It just isn't We need to take a deeper look at our actual total available market. That is, the people in the music industry who are actually going to be buying the Plec trims. Singers aren't going to be buying the Plec terms. Live shows aren't going to be buying. Deflecting the music deals aren't going to be needing Click drums. Guitar players need Plec trims, right electric guitar players and it might be some other instruments as well. But let's limit this to guitar players for now. So what we need to look at is the guitar player. So how do we find out into a calculation to see what our tam is for the guitar players? Well, we're going to need to use a formula, and the formula we're gonna use are going to be customers. Time price is really that simple. That is how a calculator total addressable market. Now, the first question is, Well, how do I find out how many potential customers I have? Well, we're gonna dive riding to that and do some actual real world research. Let's do that. So what I've done is that I've Googled Iran, have tried to find some sources and looked for how many guitar players are out there, right? And I've managed You found this on status that don't come. This is number off acoustic guitar sold in the United States from 2000 and 5 to 2000 and eight eat. So what we're looking here is that the latest data and we can see these from 2018. So we're gonna use that because that's what's available to us, right? And we can see that this is written in the thousands. So here in 2018 there were 1.14 9 million guitars sold. Now that is a pretty hefty number, right of guitarist being sold. So it stands to reason to think that if we can find how many guitars that are being sold, we can count those as customers, people who would actually need to use our Elektrim. Right. So we have 1.14 9 milion potential customers right here. Now, there's a couple of more things we need to talk about in the first is your source. Now, is this a reliable source statistic that come on, Lee shows you the statistics from some available source that they have been given or that they have found. So the question is, are these correct? Well, if you actually have a membership of studies that have come, you can see and find the source and get a source. Lincoln, if I click in here, we're gonna get straight into this document. I've already opened it up because the Internet here is a little bit slow. So we get into this document of music trades. What I could do is click on command. If on a Mac, I think it's control F on a PC, we could search for, for example, electric guitarist. You see there and here we get to see how many units has been sold, the average cost, and we get some really interesting numbers, right? So if these are important to you, you get them all here. They're not gonna be important for us right now, but we do manage to get straight to the source. Right. But what we do want to know scrolling up is that Is this a reliable source? Music traits? So it's very simple to find out. All I would do is go to Google and search for music trades. Just like that, we could see Music Trades magazine. All right, I'm just gonna click in there, and then we could see the leading journal off music products industry since 18 nineties. So for me, because you have a data reports available, this would seem like a reliable source. And if you in the music industry, they would probably concur with that. So this is great. We have some numbers already, and this is for acoustic guitar sold in the United States. Okay, but remember, applique trim doesn't Onley work to acoustic guitars it word for electric guitars as well. And I managed to find yet another source on statistic that come that shows that the number off electric guitar sold in the United States from 2000 and 5 to 2018. This is also counted into thousands. So we're gonna use this. The latest available data source we have, which is 1.9 million sold. Okay, remember, this is counted in thousands. We also see in supplementary notes here that it includes electric basis. And if you have any experience with playing in a guitarist, you'll know that appliqued in is gonna work from base as well. So that is just fine for our purpose. Now, you might notice that in the premium version over here, you get to see the source right here, the music trays and a source link. But if you don't have a membership here is just gonna say, show source. And if you click is gonna ask you to pay now, there might be other sources out there for the intent and the statistics that you are searching for. For example, it might be a Neil's that Qamar Bloomberg dot com Just make sure that you find the reliable sores and came very fight. That's all that matters. You don't need to have an account on statistical come unless you find a lot of valuable information on statistic dot com. This is just where I happened to find the information. So what I need to do now is understand. If we have 1.9 million electric guitar sold, we also have 1.49 million acoustic guitar sold. And it stands to reason that everyone who bison accused the guitarist a potential customer . Everyone who buys an electric guitar is a potential customers. Well, so what we're gonna do is we're gonna grab all of this information and head back to the drawing board. All right, so we are back, and it's time to do some calculations with the information that we have gathered. So first of all, during the customers Times price, that's called a bottom up approach. And you might hear that there are different approaches for calculating your town and their sisters alter the top down approach. There's the value theory approach. There are many different approaches, but this is the most reliable approach in our experience because it uses actual numbers, and that is going to be so very important. To get the highest probability of it being accurate, you need to have as accurate numbers as possible. Even though there are just estimates, your entire startup depends on it, so the first thing that we're gonna do is we're going to be doing the calculation. So we are going to add in the total amount off acoustic and electric guitars, they're sold together. So we're gonna do 1.49 million plus 1.9 million, which adds up to 2.59 million guitar sold annually. Remember, we're calculating annual here. When you're calculating, your time is always calculated annually per year. So that is our estimated customer Countess 2.59 million. Next up, we're gonna take that customer number, and we're gonna do times the price. So that calculation is simple is 2.59 million times $5 which happens to add up in $12.95 million. So your time in this case or our time rather would be 12.9 $95 million and that is how us accurately as possible calculate or total addressable market. So if we head back to the previous example, remember when we looked at a total available market and we looked at the music industry, we got the number 19.1 billion. Well, that's just isn't accurate. Is it if we're going to be selling applique trim is going to be $12.95 million. And similarly, if we were still selling the guitars, we would need a different number because the total music industry isn't our total available market. We need more information. We need to dive in deeper now next up. Another thing that's very important to understand is understanding geographical areas. Right? So when we did a research right now, we did it on the US, right? So these are all numbers from the U. S. But what happens if you're, for example, looking to be selling in Sweden? Well, if you're looking to be selling in Sweden, you're gonna have to do all of this. But you have to base your research on Swedish numbers and Swedish sales, and there's no short cut to that. You need to do your Googling online. If there's nothing online, see if you can contact companies and get actual sales records from them. This isn't necessarily an easy process, but general that there is enough information online that tends to be the rule, because this can also be a very costly project. So a lot of Or I would say, the vast majority of startup doesn't invest a ton of money into the research because they don't know yet if the idea is greater if the market is actually available. Right, so this can sometimes come later. But the majority off information in the vast majority of cases will be online. So let's say, for example, that we know that our tam, in this case from the U. S. Numbers is $12.95 million. And in Sweden, we might find unique Dahmer's unique sales and do the calculations there. But sometimes you're gonna find articles with great stores. Hopefully, did Onley address this in percentage? So if you find that in a Swedish article that said, Hey, sweetness doing great with the sales before still only at 40% of the total available market in the U. S. Or 40% of the sales in us, well, it stands to reason that you could do a simple calculation on that. You could take 12.95 $1,000,000 time 0.4, which is the 40% right, and then you get a new number and then you get a new town value, so make sure that you're doing your research properly. You need to have proper sources. You need to be geographically correct and then have is accurate a number as possible. Now, if you have an idea that is completely new and doesn't have a market well, calculating your time is going to be pretty much impossible, right? The more established the market already is for your product, the easier it is to calculate and you see, just like we did. We added in acoustic guitars. And we added, In electric guitars, you always have to think a little bit outside the box. Sir, if you are uber and you're disrupting the market, well, that's a shared service, right? A shared right that might disrupt the limousine service. The taxes service, the bus service. So the calculation gets a little bit bigger, and there's no set in stone correct way of doing this, refining this information. We just have to use your common sense and do the best we can. And then, as when we gather that day that we apply the customers times the price and then we get our time and the time will be on estimate right it's not set in stone eighties. Our estimate. Now, finally, I want to end this lecture by saying that you need to make sure that you document everything and the reason for that. If if you are looking for investors to invest in you, they want to see numbers and they also want to see proof and sources. Right, So this can be the make it or break it off your startup. If you're talking to investors, they're interested. But they don't trust your sources. Or worse, if all you don't have sources to show them well, that my completely break what could have been a hugely successful startup. So from the very beginning, when you're working with numbers when you're looking at the market, when you calculate in your time, write it down, document everything from the very beginning because I promise you it will pay off if it turns out to be a great and if you decide to turn it into a startup, so make it into the habit now. Already, when you're doing this research, write it all down, document everything and save it down. You will be thankful that you did this can make or break an investor investing in you and that makes or breaks your entire startup. Great job. Now, hopefully you have a deeper understanding of what your town is your total addressable market and why you need it. So next up, we're gonna do the exact same thing and dive into our Sam or serviceable addressable markets. I'll see you in the next lecture. 13. Calculate Your SAM: welcome back. So we've already calculated our time. And in this lecture we're gonna have a deeper look at Sam, why it's so important and, of course, how to properly calculated we're going to get into the nitty gritty off it. So let's go. So here we are about to calculate our sand, and it can come under many names. It can be called certain available market, serviceable available markets, service, addressable market, etcetera. But for simplicity's sake, the acronym Sam will suffer. It's just perfectly so let's look at why Sam It's so important and in a couple of questions to assist how to properly calculates sad. And then let's adding some numbers and do some calculations. Now the first thing we need to talk about is what Sam actually is, and Sam is basically looking at those you can really reach. So now, in the previous lecture, we spoke about time we were looking about the potential the U topic potential, how many we could potentially reach if we could. In our example, selling our Plec trip managed to sell a plague trim to every single person who bought a guitar, right? But the truth is, not everyone is going to need or want to buy a plex. Remember gonna look deeper into those numbers and those wise and get a served available market meaning those we can actually sell to Those were actually going to want their product, not those who potentially just could. So, Sam are those you can actually reach, and we're gonna look at a couple of questions as who those might be. And the first thing that we want to talk about here is how many can use or need the product . Now, if you remember, we had an original idea in the beginning about making instruments or guitars for bigger people or people with bigger Hafsa could and pulled the strings properly on the guitars. Well, the truth is that how many people actually need that product? Well, that would only be people with the oversized hands, right? So that would mean that the entire guitar industry definitely isn't a serviceable market at all. We would need to look at who those people actually are. That has big enough hands where that would be a problem. And who actually played guitar now also looking at our case selling a Plec trim, we need to realize that not everyone plays with a plagued women. Not everyone needs a Plec drum. So if we're gonna take an example here and we remember our previous calculation for a Tamp wants that it was at a Valley off $12.95 million. But let's say, for example, did you find some reliable source that says that Hey, Onley 50% off. All guitar players actually use a Plec trim. The other 50% used their fingers. So that would mean that your potential customer base you're serviceable available. Market is now cut in half. So we're gonna do a simple calculation. We're gonna take those $12.95 million we're gonna take 50% of that. And that's gonna leave was with $7.475 million would just cut our marketing half because the other people who play with fingers, they aren't going to be buying our Plec trim. And this is how it really segregate or tamp from our SAB and we start looking at those we can actually reach. You're actually gonna use or need our product now, another thing to look at it is it actually location bound. So we're gonna talk more about this when it comes to physical versus digital products laid around in the course. But just for now, we need to look at those important metrics off. Are you gonna put up by shop where you sell these, or are you going to sell these online? Because that's gonna make a major difference. Now, if you're selling them online or even just online in the U. S. Well, then you have a much, much, much bigger market compared to if you are location about now, we had statistics from the U. S. Rights. We're gonna look closer at that. But let's say for this example that we're going to set up a physical shop and we're gonna set it up in California. So what we need to do is understand how to do our calculations for the potential customers in California. So we already have some data, right? Right now, the current value of potential customers off our Sam is that in the US we have a potential market of $6.475 million. But if we're only going to be serving California, we need to look at new numbers because if we're only gonna reach California, we need to do new calculations. So there are two ways we can go about this. One would be if there is any such data. Look at how many guitar players are there in California. But I couldn't find any of that. So I did that the very next best thing. And I looked at the population that leaves in California compared to the US Let's have a deeper look at that. So I'm on a website called World Population Reviewed that come and we're looking at the different states here. So if I scroll down, we can see the population and it's very deafness in California. Here we could see the number of population or the amount of people living there. But what is interesting is the percentage of people living in assertive state because their current value number of current Sam value number is based on all of the US. So if we can find the percentage of people who live in California compared to the entire US , we could simply do calculations from there. And luckily enough, we did find a good source in here and we can see down here. And this is source on the U. S. Census 2017. We can go in here and verified as well as any governmental website. We can see that 11.94% off the entire population in the U. S. Lives in California. All right, so that's perfect, because that means that we can get a new calculation. And in you salmon number, let's look at that. So we are back and we have a number widows, and we're gonna use that and do some basic calculations. So we're gonna take those $6.475 million we're just gonna time with 0.11 94 which is the percentage right That is 11.94% that lived in California and we're going to get a number. They were going to get 773,000 115 so that is certainly knew Sam number. Now these are estimates. We have to remember that these aren't set in stone. Doesn't mean that there is that many guitar players actually in California might be more might be list, but with the data that we have available right now, this is going to give us a new and more realistic number. And of course, you could take this even further. So if you're on Lee planning on, for example, serving a city within California, well, then you can go go one step further and look at how many percentage off California live in that city. Then you could take that new number in time. With that percentage in, you would have a new Sam number, right? So once again, it's important that we really try to be as accurate as we can while realizing that these are all estimates. So the next question that we're gonna look at is how many can actually afford the product or service that we are selling here Now, In our case, that's not gonna be a problem, because this is a fire dollar plex trim, right? So most people can afford $5. But we can also do some studies on that and find that but pretty much gonna be a non issue . But it's a very different story. If you're selling for example, $250,000 prize is right. So if you have done your tamp on people who buy cars Well, that might be people who prefer to buy cars in the $17,000 range. So this would be a completely different number than your TAM in your Sam would be very, very different. So we have to take that into calculation as well. If we're selling expensive products. And as a final note when it comes to salmon calculating Sam, we have to understand that business growth means Sam Groth, right? So as we can see right now, we have a total available market, and then we have a certain available market, and this served available market are those who you can use or need a product, and it's gonna be based on location. How many can afford it, etcetera, etcetera. But the idea of growing a business and making a start of bigger over time means to grow your sam. So that means, for example, how Maney can use the product. Can we make sure that more people can use the product? Is it location bound, welcome with then expand the location and put it up on more locations and can be even developed digital products and digital versions off the products that finally, of course, how many can afford it. Can we lower the price of that? More people can afford it, and these were all different ways of expanding our Sam into our temp. So we have a total available market, and we want to grab us much as possible off the total available market and are Sam is going to be limited in the beginning, But we're gonna grow with more and more and more over time as we continue to innovate. And as a quick example of that would be in McDonald's, for example, Now McDonald's are all over the world. But when they first set up their first McDonald's store there, Sam was pretty limited. But then there were more and more and more and more stores, and they were able to serve more people be much more or less location dependent, and they were more and more affordable. It said S Oh, there's Sam grew completely out of proportion in the best of waste in their case, and today there are highly profitable business. So this is how we calculate or Sam. Now, at this point, we know how to calculator time. We know how to calculate our Sam. And we also realize that we need to document every every everything. Because if you can get these numbers really good, be realistic about it and stand behind them. Well, then, if you're in a position when you're talking with investors, they are going to trust you don't try to blow everything out of proportion. You need to be realistic. We're going to continue with this on to the next lecture when we're gonna calculate are some very important and then we'll have a very good idea at how to evaluate our market. So see in the next lecture 14. Calculate Your SOM: Welcome back. Now, in this lecture, we're going to look at the final step in evaluating the market, and that is looking a calculating our S O. M. Or some also known us or share off market or service obtainable market. But we're just gonna call it some. So let's dive into Let's look at some calculations and some important questions to ask in order to understand it. So here we are, and we're going to look at our some and what the sum is is just like the name says the share off market. Now, how much can we realistically obtain from our Sam? Now, we have some pretty good estimates already. From our time we've seen our total market than its value. We have looked at home in it are actually applicable to us. That is our Sam Hominy we can reach out to. Now we're gonna have a look at what is actually realistic for us to obtain out off that reachable market. That is our some. So basically are. Some is a revenue estimate way have the numbers already, and we're gonna look at how many off those numbers that we can actually reach. So we can get an estimate in our potential revenue. And remember, we're calculating annually here. So let's take it from the very beginning. We're remember we've gone from town to Sam, and no to some. Yeah, I know it's Tam, Sam. Some It's basically Lord of the Ring names. And the first thing that we want to do here, in order to properly calculate or some, is to look at our competitors. And don't worry about this. This is an art in itself, and we're gonna look at that more in depth in the next lecture. But we do need some basic surveillance on our competitors. So let's say, for example, that we have looked into the Plec trim business and we have looked into California specifically in this case that we have seen that Hey, there are 10 other Plec trim brands operating in California, right? So we can write that we have 10 competitors there right now, and we know that the Sam Disserved available market is that $773,000 right? So very easy to calculate. We're just going to split that in 10 and we get the number off 77 $1000 now, this doesn't mean that each of these companies actually earn this much, but that is an estimate, or how much they might annually earn in revenue. But the basic idea of getting this number is so that we can assess What number is it reasonable for us to earn now, this isn't science. This is estimate, right? And in order to get a pretty decent estimate of this, we need to assess the competitiveness, and we're gonna dive more into that in the next lecture. But we need to look at our competitors what they're doing, and then ask yourself, Do we think we can do a better job, or do we think we're gonna do a worse job on average from our competitors? So in this example, let's say that hey, we actually have a really solid product or really solved service product in this case with the plex trim going, and I think we can actually do something really good in here. So when their average is 7 to 7000 I we're gonna estimate that we might actually do better than that and we might do 100,000. So here we do have our estimated some at 100,000. And yes, it is at that level where you do an estimate. So the more data that you have available and the more variables that you can pull in for your time and your Sam, the better your some estimate is going to be. And if you want to take this one step further, weaken, do a simple calculation. We can take our own some 100,000 and then divided with our sam, which is 773,000 and we get a percentage. We get 0.1 to 9 in numbers, which is about 13% so our market share here would be 13 percent. Now we have to realize that there are a couple of things that's going to influence the number that we wish to estimate on on one of the biggest factors for that is gonna be assessing our competitiveness from our competitors and basically our product. But there's gonna be some more things that we want to look at when it comes to the market, and that comes from one of the first lectures will look that when we were evaluating the market, remember, if we're coming into a quickly growing Newmarket. Well, that means that we get to ride the wave and this number can escalate quite quickly. Because if this market grows quickly, well, that means that more competitors might come in, the revenue might increase and our percentage might increase off course. Some might increase, which means our Sam, or to everything increases the numbers are thrown out of the window. So this isn't set in stone. These are estimates, and they are going to change with time. But for a start up, it's very important to get it early on and try to get them as accurate as possible. But if we're getting into a quickly growing new markets, they realized that is really gonna have a strong effect on the number, they're gonna be unstable. The second thing to realize here is that if you have a product that might disrupt the market, well, then you can imagine you might do much better than your competitors then. This are some that is currently at 100,000 might put it 150 or 200,000 depending on how much we think it might destruct. The market now uber one of those again perfect examples. Similarly, would crab. Now they really disrupted the market. They really had something going. They sold a lot of inefficiencies there. And if they did the similar calculation from time salmon, some, they might think to them. So have we got something going here? We're going to assess that we might do a lot better than our competitors, assuming there was even some shared ride APS at that time which I think might have been around for a while, but uber did it really good. So to summarize, in order to calculate are some we need to look at our competitors. We need to assess the competitiveness. We're gonna do the calculation. How many competitors do we have? We're going to divide the Sam. With that, we get an estimated number. And by assessing the competitiveness there, what do we think it's reasonable for us to earn. We're gonna performs slightly better slightly worse than our competitors. Also, are we in a growing Newmarket? Do we think this might escalate quickly or are we going to disrupt the market so we might do severely much better than our competitors? Very important once again to document everything from the very beginning, the better off a job you can do it. Assessing reliable sources, finding variables and doing proper calculations, the more impressed potential investors are going to be. If you can hold your work, you can get a good cooperation and earn their trust. You can get some serious profits going with your startup. So in a nutshell, this is how we evaluate our market. But remember, we're not quite done yet. In order to get a better idea of how to assess or some, we need to learn how to properly assess our competitors and look at their competitiveness. So in the next lecture, we're gonna look at how to evaluate our competitors. Great job making it this far, it seeing the next lecture. 15. Evaluate the Competition: Welcome back now. In the previous lecture, we had a look at how we evaluate the market. Now we're gonna move on and we're gonna learn how to value our competitors and realize that the market and our competitors, they pretty much go hand in hand. You can properly evaluate the market without understanding your competitors. And you can't appropriately understand your competitors without properly evaluating the market. So chances are we're gonna get some or or new information, and we're gonna have to reassess a couple of things we did in the market. But without further ado, let's dive into our competitors. So we're getting ready to evaluate our competition now. First of all, we need to understand that there are different types of competitions out there, and we're gonna learn how to evaluate them and how different the destructive they might be to our idea, or rather, how much they might cover the market. Now, first of all, if your primary question is, well, how do I find my competitors? The answer to that is very simple. You used Google, right? You go in and you google your idea and try to imagine what would my competitors rank for and use those key were. Similarly, If you're planning on releasing something in a specific area, well, then you google your idea, the potential product or service and then adding, for example, California, you get more specific results. So let's look at the different types of competition that's out there. And the first type of competition out there is called direct Competitors, and it is exactly what it sounds. It is competitors that are directed targeting the same type of customers as you are with a the same or a very similar product as yours. So, for example, if we had an idea and we developed a product, there was a productivity app. Well, then the productive attack would be our idea, and our competitors would be other productivity. APS. It's very straightforward because we all have the same idea. We're targeting the very same market, and we're gonna have the same customers, right, so those would be direct competitors now. Similarly, if our idea was to start up a certain limousine service, well, then our direct competitors would be all their limousine services. But there's also something out there known as indirect competitors, and those are the ones with a different product or service than ours. But that target a similar customer base, right? They still kind of get into the similar or same market as we do. So, for example, if we stick by the example of the limousine service, well, then our potential in direct competitors might be different types of taxes, services and might be ride sharing, app searches, uber and certain private buses, right? Their products and services are different. Neither of these are limousine, but the idea is the same is to go from point A to point B. So these are still competitors. They are in direct competitors. So whatever idea you have, just keep in mind that, okay, I've found my direct competitors. But who are my indirect competitors now say that you have a truly innovative idea and you notice the haters Not really any competitors out there at all? Well, first of all, is that a good sign? Probably not. If there's no competitors out there, chances are that there's no market out there. But if you have already value that market and noticed that there actually is a market out there, but there seems to be no competitors well, you still do have a competitors, and it's called the status quo, and that is no easy competitors. Adult. So what is the status? Cool? First of all, well, that is the current state of affairs. The way that things are right now in this moment. And the problem is, a lot of people wanted to be the way that it always has been. Not a lot of people are happy about change now. Limit. Demonstrate this with a couple of examples. Now, already, in 1992 IBM released the very first smartphone called Simon. You Heard That right? The first smartphone was released in 1992. It's very clever. It was combining a phone together with a PD A, which is a personal digital assistants. You could do all source off wonderful and amazing things. What it's such a checking your calendar. You could receive a send mail you could also receive and sand facts. And now, in 1992 that was, of course, huge. And there were way ahead of their time Now. The problem was that they were way ahead off their time. People weren't willing to change, and their market wasn't strong enough to perpetuate that change, either, and give people a strong enough reason to adapt to this new technology. Because people already had a calendar right. They knew that if I want to check my calendar well, it's hanging on the wall. I can do it if I want to write or send the mail, have my computer. And if I want to fact well, I have my fax machines, So it wasn't convincing enough at that time. They couldn't move the status quo, even though they had practically no competitors at off being the very first smartphone out there. And, of course, let's not forget that this is a phone and a phone, especially in 1992 is primarily used to call someone with not to do a bunch of different. Other functions were so the status quo was very strong. But 15 years later, in 2007 Apple comes out and they release a smartphone and it completely takes off. It's a different time and they have a different marketing strategy and they managed to change the status quo. So we need to be very careful and thinking about this, that if we have a truly innovative idea, and we noticed that, Hey, there's not that much competition out there. Well, you still have the status quo. And even if you have an idea that does have some competitors, you need to remember that people are set in their way. This is an extra big challenge for all of us who are in the technology need, especially when it comes to machine learning and artificial intelligence. It said. The status core is very hard, and it might take a while for things to take off, and you might already have practical examples in your life. Now I know people, and I have people in my family who are still using one of these really old phones because they are so opposed to smartphones. So it's still pressing today, even though in 2007 smartphones really took off. Not everyone has adapted to them now. Another example is, for example, in 2000 Microsoft released the very first PC Tablet it. It was known as then, but it didn't take off at all. Similar to IBM's product, Simon, which got bankrupt in six months, Microsoft PC Tablet didn't live for very long at all but 10 years later, Apple comes out. Then they released the iPad. It takes off, and it's a big phenomenon today. And, of course, Microsoft has a a bunch off different PC tablets that they are selling today because today is taken off in today, it's moved the status quo. But back then, off course, there was no point of it. There was nothing new you could do. There was no reason to use it. So you can imagine when there is a service such as uber that comes in and says that, Hey, you don't need a taxi. You can use this ride sharing app instead. Now the success in uber lied and finding so many inefficiencies in the taxes services right ? And we spoke about this earlier. So if you can find enough inefficiencies and the problem is big enough and you managed to solve the problem in a smart way, well, then you can really move the status quo. But if things were working fine already, if you already have a calendar at pieces to check your email and a fax machine, maybe in 1992 you don't need a smartphone. So always keep in mind the status quo now with this in mind and haven't checked out your direct competitors in the red competitors, and I've had a good, long thought off. What is the status quo? When am I real disrupting some old pattern and strongly held beliefs in their behavior? You need to move on to the next thought, which is how is your product different from what is already out there and how is your product in it? Better. So, for example, now there's a smartphone out that it has a calendar, but I over to have a calendar here. What's the benefit off? That the product is different? But what would be the benefit with having the calendar in my phone is in 1992. Similarly, you might notice that your competitors they have a singular product to yours, but they have some extra added value to it. So this is really gonna make us think hard and long. Okay, so what does this mean for me entering the market? So having a look again at our Tam Sam and some it might mean it. Okay, they have actually added more value than we have to a product. We have sold things a little bit differently, but ultimately our competitors are offering more value. Well, that means that our Sam is going to string. Well, that means that our Sam might be effected and most definitely are. Some is going to be negative affected, but similarly, the reverse might be true. It might notice that Hey, we found so seriously inefficiencies and our competitors aren't solving these well. But we are. So we can expect are some share toe actually be bigger than what we initially calculated. So have a good look at all of your competitors. Starting off with your direct competitors, writing everything down as usual, you need to document everything, find how they are solving this problem that you're also attempting to solve. Look at your indirect competitors. How big of an influence do you think they're going to have on the market in the market that you're trying to get into? I understand if the status core is gonna have an effect or not. If you're releasing an app today, it may or may not unless it's very destructive than the status school might be a problem, and then look Okay, how is my product differently and how is that going to affect the initial evaluation off our market share, or some? And then also, when we're looking at our competitors, we need to think about big versus small competitors. Now a big competitors going to have a lot more resource is in the small competitors will. So that means that if you have a great idea, you release the idea and your competitors who happens to be a big company catches only could release Ah much bigger and vastly improved product off the same time that you were trying to release or improve upon it in a better way than you are able to because they have bigger funds. That's just the way things work it. But if you are up against big competitors, don't worry about there's plenty of success stories out there. You just need to be a little bit smarter and find those loopholes. And a perfect example of that is the Dollar Shave Club now. Before they came to the market, Gillette was all over the place. Gillette waas the name behind any form off facial self care for men. If you're looking for self grooming and in the type of shaving moisturizing etcetera. Well, Gillette waas the brand and they were everywhere. They had all the market channels. They had all of the spots in the supermarkets that had all of the possible sales avenues you can imagine. Gillette wants the name and they were a big brand, and they were focused on luxury shaving luxury facial self care for men. You know what the Dollar Shave Club noticed here is that? Hey, they're doing great. They're earning millions. But there's a loophole here because not everyone is into the whole luxury kid. Some people just prefer a shaver to be a shaver and keep it simple and therefore keeping it Scheepers what they did. They made their idea about doing a simple but efficient shaver that would be much cheaper. And guess what? Their idea worked perfectly wasn't luxurious, but it was highly effective that put all of their efforts into a shaver, which completely took off. They stuck with the business good for a couple of years and then end up selling it for one billion dollars. So, yes, they found a loophole, the founding inefficiency in their marketing and in their business off Gillette. And they used that for their own idea and build something from it. So it's very important that we remember, especially when we're looking at big competitors. That is going to be harder. They're going to have more funds. They're going to have more capacity. But what are they lacking? The bigger the company, the bigger the holes usually. But in the end, there's always gonna be a preference for small competitors because small competitors they're gonna be in a similar position issue. Donald Hamel LTD. Fund development takes a longer time, and the level and playing field are going to be more even. So if you're looking at documenting everything which you really should and talk to investors, they're gonna have a preference for small competitors. And before we end this lecture, I just want to say something that's very, very important and reiterate this, and that is in 90% off. All start ups fail. So what does that mean? Well, that means that while understanding and evaluating your competition is very important, you need to understand your competitors on the market. But don't focus too hard on your competitors. If you're finally inefficiencies in a big company, for example, don't be so scared about those big companies because you found the loophole in you can grow . And similarly, if you find it all your competitors, small businesses, then natural, you're gonna want to compete with those. But there's chances off those start ups putting themselves out of business. It's much bigger the chances of you putting them out of business or then putting you out of business. The chances are much bigger that you were gonna put yourself out off business. So put your focus on yourself. Your idea when you've done the proper evaluation of founded haters a great idea here, everything checks out with the problem. The solution, the market, the competitors. Everything is green. Then go keep on eye on your competitors asked ago. But put the focus on yourself because chances are your competitors. They're going to remove themselves from the business. And if you're not careful, you might just do that yourself as well. So put all of your major focuses on your idea when you got a degree in life perfect, well done making it this far. Now we understand how to do some proper evaluations off our ideas. Let's move on to the next lecture we're gonna look at a checklist that we have created so that you can quickly just check out all of the things that a great idea needs for an idea to be a great idea. So see in the next lecture. 16. The Evaluation Checklist: So you've learned a lot about evaluating already. Now chances are that you're going to come up with a lot of ideas, which means that you're going to need to do a lot of evaluations now in order to help you move through all of your ideas. To find the great ideas faster, we have created a evaluation checklist for you. Let's check it out. So here it is, and it's very simple, and it exists already in your resource is now. The idea is simply that you write up your idea. First of all, let's say in this case that the idea is that productivity app for marketers, right? And then from that idea, we can use this checklist to move through the different topics off evaluation that were checked out already. So let's first look at the problem. Is it problematic enough? They say, Yeah, it is. So we're gonna check that. It's it's a common problem. Well, yeah, it is. And would you pay to have it fixed year? And now we're, of course, talking about the problem that the productivity gap for market there is supposed to salt. Then we'll look at the solution. Is it actually solution. Yeah, it's a unique sustainable. It is. Is it a quickly growing Newmarket? Let's say, um, it's not. But can you disrupt it? Yeah, we can. Does it have further growth potential? Yes, and then we look at the competition. Are they're direct competitors? Yeah. Is your product different? Yeah, and are the mainly small competitors. Let's say there's some big names in there, and then you have your checklist. So this is some way when you've done some evaluation, too, right up your idea. Check through the checklist, and then you can have a big collection of different ideas that you have a value in and see which one looks the best. Which one do I want to aim for? The way to get a bird's you and also move through the evaluations Foster for your ideas, so all you need to do is printed out and then just check it off. It's that simple. So I recommend you print out a couple of these, and I hope you have a lot of use for them and good luck and enjoy your evaluation because there's supposed to be a lot of fun right now. In the upcoming lecture. We're going to start looking at some additional ideas for your evaluations, right? I'm talking about both growth potential scalability and also hey, should I maybe look at having this idea or product or service in a different four? So it just some additional thoughts for your already probably quite busy but very effective mind. So let's move. Wanted in next lecture. See there. 17. Scalability: Welcome back in this lecture. We're going to be talking about scale, ability. I want to pre face this by saying that first of all, if you're looking at bootstrapping your startup that is using your own funds and you're planning on keeping your start up in your business as a small business, well, then the scale ability isn't going to matter much. Some people are completely fine with having a small business, and they thrive off that lifestyle. But two things. One. If you're looking at getting some big profit and two, you're looking at getting investor back then you need to make sure that your idea and your startup has scale, ability that is the ability to scale. So we're going to look at a couple of different options and basically, what scale, abilities and what you want to know about it. Let's dive in so scalability and his most simple form is about growth, right? But scalability for your start up, or at least the potential of your scalability, is going to be depend on increasing revenue with minimal expenses, right? So if your startup is very scalable, that means that you can very easily get revenue increase without it costing too much in the long run, right? It's all about increasing revenue and increasing profits. And there are a couple of different things to determine if it is scalable or not. And one of those is your tam size. Now, if you have a very small time, that means that your ability to scale is going to be limited. And we've already talked about time and how to calculate your town, and we got some numbers already, right? But if you want to have the ability to scale your startup, we're looking at a time site between 10 and $100 million right, preferably in the upper range. Anything smaller than that, that's going to be seen as a limited market, especially for investors. Now most investors aren't going to be interested in investing in Start up that has a time that's below $10 million. This is very good to keep in mind, so that means that the previous idea that we were looking at when it came to our $5 click trim that ended up with a time at $5.18 million. That's just a no go right. That means that it's not gonna be very scalable, and investors aren't going to be very interested in that. So aside from having a good time size, then next thing we want to look at is your product. If this digital or physical, your product or service, that is, and we're going to go more in depth into digital versus physical product in an upcoming lecture. But for now, let's look at their differences when it comes to scale ability. Right now, let's take an example. And let's say that you're going to release a book, right? That would be a physical product and equivalent to that book in the digital world would be an e book. So there's gonna be some differences between these two right now. Ah, book is gonna come with a couple of additional costs. Costs such as you're going to need material. To get the book out, you need to have a publisher. There's going to be printing costs. There's going to be shipping costs, and there's also going to need to be cost for getting your book out in the stores right, so there's a lot of different costs that comes with having this physical product Now, when it comes to the digital E book, that's going to be much easier. There's going to be none of those costs. You can just copy paste and the scalability is gonna go through the roof. So that would be a clear benefit in terms of scalability, right? So if we look at the book, the physical book, that means that in order to increase the revenue, we also have to increase the expenses. Because if you want to sell more books, there's gonna be more, Ah, higher production. Which more means high production costs means more shipping gonna mean more deals with different bookstores, etcetera, Whereas if you want to scale the e book that doesn't come with that at all, you can just completely scaled by a copy paste mechanic, which is one of the great benefits for digital product. Now, it's not all flowers and sunshine. We're gonna go more in depth in the different in an upcoming lecture. But needless to say, if you have a digital product, well, that means that your scalability is going to be much higher, and it also means that you're Sam is going to increase quite a bit, so if you have a product right now on idea, and you can somehow also turned that into digital idea, your Sam is going to increase exponentially now. The next thing we want to look at in terms of scalability is automation. In order to scale your startup, you're going to need a lot more time and resource is, and preferably money. But most importantly, if that is going to be time, and if you can automate as many things as possible in your business, well, then there's going to be much more potential for you to scale. But if you're going to be stuck in doing mundane tasks, well, then there's no potential at all to scale your startup. So, for example, let's say that you're looking at getting a product support or help disk for your start up right. There's going to be an integral part off your idea. So in the physical world, that would probably mean that you have to hire someone in someone that actually meets the customer and sits down and talk with customers. That's gonna be an expense now online. You could, of course, hire someone in this well, but you could also use a bottom. For example, you could use a chat, but and might soul most of those problems, so that would be a way to keep the costs down. Now, when it comes to the digital world, there is a lot of online products out there the focus and automation and whatever you can't automate, you need to make sure that you outsources whether that's online or in the physical world. But don't get yourself stuck in the mundane task, because that's really going to keep the startup from growing. But if you want to be able to scale, make sure that you automate as much as possible. The more you can automate the better. Outsource whatever you can't automate and then you'll have a much better possibility off scaling. So look at you already. Look at your startup idea and see where can I automate things and what do I need to outsource? And then you can determine the scale ability from there, and next up is going to be the capacity for mass production. Now it goes without saying that if you want to scale something, you're gonna need to mass produce it. When it comes to mass production, in the digital world is very, very easy. You can have millions of products in just seconds is just cooked it paste for most of the product. But out there in the physical in the real world, Well, if you have a physical product, that means that you are more limited. Similarly, it comes the same when it comes to services, right, Because if you're gonna perform a service, there is only one of you. So when it comes to mass production, you're gonna have to look at OK instead of doing wanna What can I do? Groups And similarly, can I teach this to others so they can do it as well? There would also be a form of mass production, but all of these are gonna come with expenses. And if you have a digital product, there aren't going to be expensive. And we're going through the digital versus physical a lot because they really differ in terms of scalability. But as you're going to see in an upcoming lecture, there are both benefits and downfalls. Will incomes of physical versus digital, But to summarize it when it comes to mass production, how are you gonna be able to if you have the product, get more products and what is going to be the production cost? So, for example, if you have a limousine service, you're gonna need more limousines, right in getting more limousines. Well, there's gonna have additional expenses, and you have to look at what is the profitability in relationship to the expenses. Now, that's not gonna be the same problem in the digital world. And similarly, if you have a cheaper product like we looked at the Elektrim, that means that mass producing mawr of these are going to come with a less of a risk because the value of the product itself is lower. So if you have a couple of limousines standing, they're not, You know, doing their thing that's gonna be a problem is gonna be a huge loss if you make two minute collecting. Just gonna be a loss as well, but not as potentially big off a loss. So look at your capacity for mass production. And if you're in a digital world, well, then you don't have to worry about that. If you're in the physical, you have to value the production cost in the minimum order quality And if you have a supplier, you also have to look at their minimum order quantity, what that is going to be and then assess your capacity for mass production. And then you can evaluate the scalability off your start up. But before you do any of this, you need to assess where you want to take your business. First of all, do you want it to grow really, really bigger? You're aiming for big profits. If so, you need scalability if you don't have skill ability that it's not possible at all. And secondly, are you looking to get investor back to you, looking for investors to put some funds in your idea? If so, you need scalability. You need to nail the time you need to document everything in Get is right. But if you're looking at bootstrapping and if you're completely fine with keeping things in a smaller size, scalability isn't going to be as big of a problem. Also realized, as time goes, there's going to be changes. Whatever ideas or additional ideas and innovations that come up might be digitalized, and that is severely going to change the size off your Sam and your ability to reach out and change the mark. So things change. Just plan for scalability is very important. Well done. I hope you followed along. And by now you have a lot of great ideas. You know how to evaluate. We're getting some additional thoughts as well. So in the next lecture, we're going to look at the difference between B to B and B to C sales, some profits and some benefits between both On what you need to think about to see in the next lecture. 18. B2B vs B2C: hi again and welcome back. Now in this lecture, we're going to be looking at the differences between B to B and B to C. You don't know what those are. Don't worry about it. We're going to go through it in that there. Look at their differences in their advantages and consequences with using either what's So when you have an idea and you have a product or service that you want to sell, it's very important to keep in mind. Who will I be selling? These two. Do I have a business solution, or am I looking at reaching consumers directly? Let's dive in. So be to be versus be to see what we're looking at. The difference between selling to businesses and selling to consumers, right? So be to be status for business to business. In other words, you are looking at your potential business and start appear to be selling it to other businesses. That is your business solution, and that could be anything. And some of the most common things to sell nowadays are Softwares, for example, So if you have a software to sell, there's going to be a solution for another business. Well, then you are into B two b market right? Similarly, if you have services to sell, that helps other enterprises. You're also into B two B market and start ups who are focusing on the B two. B markets are usually called startup enterprises, and they are targeting other businesses. Ask their main customers. But first of all, let's look at a couple off advantages and this events just to being in a B two b market. Now the first thing to consider is that that market is smaller, so there's definitely going to be less businesses than there's going to be a consumer. So that is something to keep in mind and a smaller market. What does that imply? Well, that implies that when you're going through your leads, when you're trying to find your customers to find businesses that's going to be interested in your solution in your product or services, you need to make sure that you're creating a deep relationship with these and that you're getting some proper leads from them, right? So let's say that you have 20 available businesses that you know of straight off the bat, and if neither off them are working up with you. Well, then you are in trouble because you know you're in a smaller market. So what is required here is that do you reach out to these businesses and you start building a deeper former relationship with them? Because businesses are looking for long term plans and long term solutions, Right? So if you have something really good, a product or service is gonna help their business grow, they're gonna be in it for the long run. And that's quite a bit different from the B two c concept, but we're gonna look at that in a second Now. The next thing that's going to be specific to two b two b business is that a business requires stability that is there going to be looking at your product or service and they're gonna say, OK, hey, this sounds pretty good, But where are you going to be in two years from now? Within five years from now, this is an important distinction because if you are releasing your product or service to the masses, well, they're only going to be interested in what's in front of them then and there. Do they want it? Are the interested in it now, yes or no, but a business. They're looking far more long term. If they're going to be adapting your product or service, they want to know that you can go with the times that you can update when there's updates needed. And if their business changes with time, can you change with them? Are you able to provide additional solutions? And customization is for them. So demanding stability is going to be a big deal when you're trying to sell to other businesses and next up. And this is one of the biggest advantages when it comes to selling to businesses instead of selling to consumers. And that is the businesses. They know what they want, and that is a huge benefit, because when you're selling to consumers, consumers don't always communicate what they want to have a product or a service, and you put it out and it might get traction. You might get a lot of sales. You might get a lot of successfully might not, but when it comes to be to be, you're going to get to hear Black on white hate. We really like this about your product or we really dislike this about your product or even more importantly, this is exactly what we're looking for. And that is the great benefit. When it comes to B two b market, they're gonna tell you what they're looking for, and then you have to look at Are you able to adapt to those needs, right or to those demands? Rather, when you're selling to consumers, they're not gonna come out and tell you, hate we all these millions and billions of people, we are looking for this. No, that doesn't happen. That is one of the greatest advantages of being in the B two b market. But next up, let's look at what it means to be in a B two c market and that stands for business to consumer. So we are selling directly now to consumers and not to businesses. And you already know a couple of companies that are like this, such as Netflix. They sell directly to consumers. You know Amazon. They sell directly to consumers, etcetera, etcetera. So, once again, let's look at a couple of advantages and disadvantages, and the first thing to bring up that is that the B two C market is dominated by large companies. I just brought up some pretty big names, such as and Netflix, such as Amazon, such as apples such as Microsoft, even though both Apple and Microsoft also sale in the B two B market. But they are some of the huge names in two B two c market. That's well, but you're gonna notice that everything that's being sold to you as a consumer like Sephora , H and M, for example those are usually large companies because they're reaching out to large masses now the next thing to know is that this market is a little bit more difficult. Yes, it is bigger. But understanding the market research years very different in a B two B market going to be to be model, they're gonna tell you. Okay, we like or with this, like you're ready at this is what we need. You don't get that benefit when you are in the B two c business, so that makes that market much more difficult. And sometimes it's kind of a shot in the dark. You can do the market research. You can look at the number you do your tab, Sam some, But in the end, Maybe your product works up, maybe a dozen, and you're gonna have to make adaptations that you think it's going to improve your chances in two B two c market. But in the B two B business you're gonna hear Hey, this is what we're looking for. OK? Are you able to adapt? Yes. Then chances are you have a deal so quite a bit different here in the B two C market. The next thing to bring up is some of the biggest successes off. All companies come from the B two C market. Some of the largest companies out there are in B two C, so there's a give and take care. While it's harder to succeed in B two C, it also means that should you succeed, you can really write that weight and become a huge business with a huge net value. And that is because there are millions and billions of people out in the world. And if you have a proper tam and you have proper scale ability and you get traction in other words, people actually like what you put out well, then you can have a lot of consumers, and you can have a lot of results. When it comes to business is, well, they're gonna be more limited. It's a smaller market and they're probably gonna stick with you for a long term. But the scalability is sometimes a little bit more limited. So when you're thinking off these huge successes in the world, you most of the time talking about B to C and the next thing to bring up and this is really worth mentioning is that the B two C market is very prone to luck. And that is true with most of the things. Now, if you remember the example with Google, for example, they did a really good job. They found the inefficiencies and they put out a really great product and improved things. However, we have to understand that back then it was really big deal with search engines. Now, ever since Google has released their search engine, they have released some additional very successful products as well, such as the chrome Web browser such as Android. And then there are various different Google product, such as Gmail, etcetera, but none off. These additional products that they have released have ever turned out as big ask their search engines their initial release. And this is true for most of the startup that managed to get this sort of really nice traction in two b two c business when you have your first big success, initial releases or additional releases. Rather, they tend to not be as big as your first very big success because you rode on that, a wave off LA care. And that is why there are so many startups right now. There's in the artificial intelligence that's in machine learning and in the technology section, because there's right now. There's this huge opportunity to really land. Go with the flow, grow big, and then you'll be on top of the market the very same way the test lies today. Now Tesla's very unique right? Did your electric sports car. There is a market for sports car. There was a market for electric cars, but they were known for electric sports car, and there's definitely going to be more of that in the future. But they are in the top already, so that is one of the difference again when it comes to be to be versus B two C just to keep in mind. And as you can hear, if you're looking for the biggest success, B two c, it's probably your game. But if you're looking for long term success and probably on the East, your success, if you will be to be, is going to be a good bet. But let's look at some further differences and understand the different markets even more. And let's look at some further differences. Now consumers conform and businesses differentiate. So what I mean with that is, if you remember when we were talking about the status quo in an earlier lecture, well, when Simon was released in 1992 the customers back then weren't too happy with it, right. They weren't too willing to change their status code that were set in their ways, and they didn't adapt to this new technology. And the reason for that is too full won the status quo, but also because no one else was adapting to. If some people were and it got a lot of traction, a lot of people adapted to it. Well, that would mean that a lot more people would come for because people do what other people does. It's a vicious cycle when it comes to marketing. So if a lot of people start using your products, chances are a lot more with start using your product. It's a snowball effect that just rolls down and goes bigger and bigger and bigger. The issue is to get the snowball to roll from the beginning. Now businesses, they are different. They're not looking to conform. They are looking to differentiate. They're looking for business solution so that they can waste less time, be more resourceful and they're looking to get the edge or competition. And that means that they need to be different, not conform. So if you have a product or a service that is different when that is very new, chances are that the B two B market is going to be Maurel Irving than to be to see. So, for example, had Simon them properly put a marketed towards to be to be section. It might have gone in a better traction than indeed in two b two c market because they went bankrupt after six months. So it's worthwhile to consider that businesses, when it comes to your solution, they're going to be more prone to adapting it because, first of all, they listen a second of all, they're looking for something different, budging the status quo in getting the snowball rolling. When it comes to the B two C market, it's a little bit harder, but if you get it rolling, it can turning toe really big snowball now next that we need to talk about the different sales tactic. Now. Of course, if you are in the B two C business, well, then you need to understand marketing and a lot of Monica Ghost into that sort of marketing , reaching out to the masses and hoping that it will latch on. We don't always know what people like and what is going to disturb the status quo, but we can get some pretty good estimates by doing some proper market research. But here is the difference. When you are selling to consumers well by them, they're looking for the benefits what are going to be the benefits in my life. But when you are selling to businesses, they're looking for features features on. Okay, Black on what? How can this improve my business so the sales tactics are going to be a little bit differently. now the disadvantage here. That can be sometimes that when you're selling to businesses, an enterprise of sometimes they're looking for customization and wasteful customer stations because they think that the more things that a for example, a software can do the better is going to be for business. But that is not true, because we know that both Google. We know that Apple and Microsoft they're going in the direction of simplifying things in the B two B market. They're still having the idea that higher customer stations means more profitability. So if you have some really clever solutions, sometimes that might actually feel better in the B two C market. But it's going to be much easier to sell in the B two b market. The B two B market tells you what they want and what they're looking for. Two b two c market. You see the inefficiencies you release, then you hope that is going to get traction from the feedback that you're getting. But the feedback from all of the people is still going to be fragmented in comparison to getting feedback from the big businesses, because ultimately the business is the one who's buying it or not, and then finally understand that there is, ah, lot off B to C start up. That then move over to be to be for the recent that we've outlined before this. Sometimes getting that Snoble started in two B two C section can be really hard. And in the B two B section, it's a quite a bit easier because they tell you what they need. But also they're looking for long term partnerships, right? They want to see the stability and see that. Hey, this is something that we can work within the coming 235 maybe even 10 years. But when you're in the B two c market, you might have an initial release that is awesome, and then it sort of just dies down. It's just becomes a trend like the fidget spinner. So when you are in the B two B business, usually there is a cap on the scale, ability and the possible profitability and how big it can be. But it's much easier to gain profitability and long term profitability into B two B section . So don't worry if you have a solution that you notice not working up well in two b two C section. You might have another idea or the same idea that might work out well in the B two B section. Some companies sell to both, like Microsoft and Apple, for example, So if you're selling computer to a consumer, that's fantastic. But if you're selling computers to a company to a business, that probably means that what they're buying is going to be huge package. Maybe they need or they have a pretty big companies. Do you want to buy 2000 off your computers? Now Getting 2000 customers can be quite difficult, not from Microsoft. Don't get me wrong, but if you're small, start up. But if you get 2000 soldier business, that's not very surprising, said the prophet. Initial profitability is going to be very high in B two b, so I understand that sometimes you can expand into both. But the big sum of money. The bulk sums are going to be in B two b. So look at your idea and see where this it applies is be to cease its B to B and can you combine it and sell it into both and do like Apple and Microsoft is doing now let's take a successful example here now Slack. You might be familiar with slack. We might not. It is not very important, but they create our flag named Butterfield, he's the co founder off Flicker, and it was his dream for many, many years to create a game. There was never ending. So most games that we play online today, we play to win. He wanted to create a game that was never ending well, to make a long story short. He failed and he failed twice. It lost a lot of money. He had to lay off a lot of people. But along the way some of the inventions that he had created for that platform or for the game rather, he noticed that, Hey, they had a pretty cool messaging app. So they took that and they continue to develop it. And they noticed that Hey, this is actually working pretty well. This could be a really cool enterprise solution. So while initially he wanted to create a game in the B two C section and that failed. So he took apart off that the messaging app and he moved it over to the B two B section and it became quite successful because it's been net valued at around $15 billion. Doesn't mean that all of us can move from B to C to be to be and go from, you know, failure to earn billions off dollars and be valued in billions of dollars. But it goes to show you the difference is in the different markets. And what the potential art. If you keep your mind open and just think about what do you have in front of you and where is it going to best fit now if you don't have a on idea yet and if you haven't really gone to the Czech Place and found something like, Hey, this is something I want to focus a start up on I recommend to you that generally it's a bit easier and a pretty good idea to focus on the B to beat section. So just keep that in mind and think when you're coming up with ideas. Okay, what are some of the biggest issues in business today? Off course they're looking for software solutions. They're looking for automation. They're looking for services, etcetera. And should you come up with something to B to C section look at can be supplied to the B two B market as well. And similarly, if you have a B two b idea, just this apply to the B two C market as well. But if you need to kind of a bend your mind in one direction, I recommend Generally, focus aren't be to be in the beginning, it's a little bit easier to start up something you and get profitable. So I hope this was valuable to you. We're gonna move on to the next lecture, and we're gonna look at products and services that are physical versus digital and some advantages and some disadvantages. So see in the next lecture 19. Digital vs Physical: So in this lecture we're going to be looking at the differences between having a physical product or service compared to having a digital product or service and each one of those. They come with their own set off advantages and disadvantages. But let's dive in and have a deeper look. So back in the days, all starters were, of course, just based on physical products. But now, as technology has advanced, we have the digital age. Well, then we have a lot of digital products as well as the death means that if you have a book release, you can also turn that into an e book and suddenly have a physical on. You have a digital product, and if you do have such an idea that where you can make it both physical and digital, well, you are in luck. You can double your market. But for most of us is gonna be either a physical or a digital product, and that is gonna come with their own advantages and disadvantages. And that's exactly what we're gonna look get right now. So the first thing to talk about and we spoken about this a little bit before its scalability, and the scalability is going to be different, depending on if you have a digital or physical product. So we already know how to calculate our Tam or Sam and our song, right? But if you do have a digital products, you're not gonna be quite as limited when it comes to your Sam. If you have a digital product, you can just completely, pretty much completely expanding to your entire tam area. And that's simple. That's because the digital product they are so far reaching and the same goes if you have a service. Now let's say that you do local therapy as an example. You have an idea that somehow spins off of that well, you're bound to location. But if you do it over Skype, well, then you're bound to reach out to a lot more people. You have a much, much, much bigger potential Sam, so there are quite some differences in scalability, and if you want to scale to disguise well, then digital product most of the time are your game. But remember, physical products they are the true and tried have been around for a long time. It's just that scaling them comes with risks. So there are differences. We've already spoken about scalability, but it's worth to bring up once again because it's one of those major differences. Now, next up are the margin differences, and we're talking about different profit margins here. And it's quite the difference that if we look at the difference between a physical product in this case, in a digital product and we're gonna use to too extreme so the physical is gonna be completely physical, is gonna be location bound and the digital is gonna be 100% digital. You could have, of course, hybrids. So, for example, you have a physical product, but you do drop shipping. So then you're gonna remove some off the cost. But let's do the extremes. Well, that means that that is gonna affect your margins. Your profit margin is gonna go slightly lower. Similarly, if you have a physical product, but you can move on and digital I some of the aspects well, then you're gonna increase your profit margins. So why are the profit margins so low for physical products? Well, this because mainly distribution costs comes with a lot of downfalls here. So, for example, we're talking about storage fees were talking about shipping fees. We talk about handling fees. There's gonna be a lot of additional fees where there's gonna be a potential card fees. If you're using a card reader, if you have a location and you're selling these directly is gonna be those location fees as well compared to, if you are, for example, drop shipping. And that's not even having spoken about, you know, all off the returns for all of the lost ship. Mr. Com with this is really gonna pull down your profit margins. But when it comes to the digital part, well, there's gonna be no shipping fees whatsoever. If it is a truly digital product, there's gonna be free. Delivery is just a click of a mouse and you got it. You want an E book? You downloaded? You want a A song, for example, you don't loaded. You want the software you downloaded, you just pay and you get it instantly. There's gonna be a little to no storage fees, and I say little here because some are gonna be hybrid. But in the extreme spectrum is gonna be no storage fees because there's nothing to store because if you have one product to just copy pasted, then you put it out on the platform and you can have millions of people to download it. So, yes, if we're looking at just the profit margin differences here, it's quite easy to see that the digital age that's here right now they're doing some pretty crazy things that was completely impossible. You know, 2030 years ago, things are really changing up. There's one of the big benefits off digital products now. The next thing to look at is the perceived value and the proceed values gonna be. How valuable does this look and why is that important? Well, it's important because whether you're selling to a B two B or two, maybe to see you want to showcase that whatever product or service that you have, that it is so value. And in this case we're gonna talk about a product again. And if you have a physical product and you're gonna try to sell that into a B two B into a B two B market, will is gonna be much, much easier to showcase that because that is tangible. You can touch it. You can showcase it you can actually see. Here is the product that's a big downfall. With digital products. Anyone can create a digital product rights, and that means that the proceeds value is going to be lower because you can touch it. And basically anyone can create one, not saying that everyone can create great software programs. But not everyone can distribute and create new physical products, so that's very tangible. So investors love that potential enterprises it wants to be sold of your product loves that . So it's a great benefit off having a physical product in this case, when you're looking for investors or in a B two B market, but also a B two c market, because you can really showcase the value like going into a store, and you can try it out to test it. A feel like a smartphone really increases to proceed value now. Next up is competitiveness. Now we really do need to speak about competitiveness because there's quite a difference between the digital and physical, and hopefully you have already evaluated your competitors. You have already evaluated your markets. You have a pretty good idea, but that it goes mostly for the physical, right, Because if you're gonna be in a certain location, it's quite easy to have a look at. OK, who are my competitors and what are they doing? But if you're releasing a software online, well, then the entire world within that niche, of course. But pretty much everyone is going to be your potential competitors in the digital product and service on. Why is that? Well, if we're looking at a digital product, look at all these. We're talking about 80 to 90% profit margins. We're talking about no shipping fees, free delivery, little to no storage fees. That's some crazy crazy benefits right there. So naturally everyone wants in, and that means that the competitiveness is huge. So unlike the digital world, the physical world, it's a little bit more tangible, and you're not gonna have asked many competitors. It does come with its own risk, with the production costs and everything and the difficulty in scaling. But when it comes to the competitiveness, you're gonna be in a nicer spot, because if you release a digital product, it looks nice. But someone else releases something better than that. You're gonna be out of the game the next day. Should things go that quickly, anything can happen. The competitiveness is really, really rough online, so that is something to keep in mind as well. Now the final thing to talk about here is time consumption and time consumption going to be different between the two. Because if you are looking at creating a physical product, well, that means that there's going to be a lot that goes into creating the product, handling that problem, distributing and getting it ship. I mean, there's a lot of stuff that goes in there. Now, if you have a digital product, that's gonna be really, really quick, right? A digital product means that you have created you can send it out, and basically the world is your oyster. Next day off to release the same isn't necessarily true with a physical product. Similarly, if you have a physical versus a digital service with a physical services still going to need a location, you're still going to need to run your marketing both online but also word of mouth. And remember, word of mouth marketing doesn't scale very well, does it? So you're still gonna have some time consumption in getting customers that way. But if you do your services online, well, then you can do your online marketing, which is very competitive, remember, but it's also more accessible. Ziff, you know what you're doing. You can get a lot of customers very quickly when it comes to online services compared to physical services. So the time consumption. Also, if you are running a team, for example, well, you have a team for a reason because there is a lot of things that needs to be done. So that means that if you have a new product or a new idea or a scaling well, from the inception off that thought to the actual action in executing it in the physical product and service, well, that's gonna take longer. But in the digital, that's gonna be much faster. And what is going to take longer in the physical? Well, this because there's gonna be distribution, storage, shipping, handling this a lot of things that go in there, not all of these air true off course, because there's gonna be hybrid cases and you don't really need storage necessarily if you are doing physical services. But looking at some of these is still going to take longer compared to the digital, because in the digital, all you need is a click and it's done. And that's really why you have such high competitiveness in the digital era here. Because things were moving so fast and there is so much to gain, the profit margins are so high. So these are some things to keep in mind whether you have a product or a service. If you're looking at keeping a digital or physical now, similarly, also know how to value if you want to go to the B two B or the B two c market. So by now, even though you know how to do the evaluation, there's still some more things to think about, which ultimately might get you back into conceiving new ideas, doing new evaluations and then, you know, entering different markets. So just keep all of this in mind and see what lines up with what you're actually interested in and what you're actually looking to do with your time and with your startup. So great job. So in the next lecture, we're gonna talk about products versus services, so I'll see you there 20. Service vs Product: welcome back. So in this lecture, we're going to be looking at the differences between having a product and having a service . And, yes, we're going to keep the physical and the digital in mind. So let's dive into it and check out the advantages and disadvantages off each. So before we move on, let's define the difference between a service at a product and see what they actually are now A. Services when you perform something for someone else. Now that could be, for example, computer repaired. That could be a massage that could be doing a financial analysis. Those are all services where you perform something for someone else. Now a product is just like it sounds. It is a product. It can be a digital software, or it can be a physical products such as a model plane, hard drive. It could be a smartphone. It could be anything that is a product that you can mass produce and sell more off. You can mass produce and sell more off your services unless you have more people doing it. So let's dive into some of the benefits and disadvantages off each of them. Now, the first thing that we need to talk about that really stands out. That is the set up costs. Now, if you have a service that you are performing and let's say that it is a digital service, well, then that is gonna have the lowest set up costs and the fastest to get into action because all you're gonna need is ah, website and perhaps a platform, like soon and then or Skype. And then you could connect with others and perform your services online. If online or a digital service is what's viable for you now, a product is going to be different. A product. Ah, lot of the times, we're going to need either bootstrapping and having some capital on your part or you're gonna need funding, which most of the time you don't need. With a service, you're gonna need to conceptualize your idea. You're going to need to sell your idea, and you're going to need to aim at your market for your ideas. So, ah, lot of the time there is investment in there. If you have a physical product, it comes with some risks. If you have a digital product, it comes with time, investment and perhaps on risk us well, if you are hiring programmers, but most of the time, both of these they require quite an initial risk management because you're conceptualizing in creating an actual product. But with a service. Unless you actually need Teoh, go ahead and educate yourself within something. You can start performing that service right away, so the set up costs for a service is going to be significant that much lower than a product that you're gonna need to do some mass producing for in order to actually be able to sell it. Or at the very least, if it's a digital product, you still need to have it program and get this software or whatever your dishes A product might be no next up. And I know we've spoken about this before, but we need to speak about it again. And that is scalability. And scalability is something that really sets apart services and products. And there is one simple reason for that. And that is because we didn't a service. You are trading your time for money, and that is extremely limiting. So even if you have a really good hourly rate, you only have a certain amount of hours each day. However, when it comes to a product that's different if you have a physical product, for example, yes, you can mass produce that physical product, and then you can scale through that. If you have a digital product, it's even simpler. All they need to do is copy it and sell it to more. Or just expand your marketing, get more consumers, get more sales. It's really that simple, but that is not quite possible with services. Now, what a service. What you can do is that you can hire people and have them perform the service. But it goes without saying that hiring someone else comes with their own risks and costs off course mass producing that comes with their own recent costs as well. But still, they're not gonna be on an hourly rate, so you're gonna be severely limited. So if you're looking to scale to disguise, well, then having a service start up probably isn't for you. Now, Next up, we're going to be looking at time consumption, and these two are quite different because if you have a service that you are performing and you're looking to perform or services for people. Well, then, from inception, the idea if I'm gonna perform on the service to people to actually performing that service for your for other people, that can be basically the next day or within a couple of hours. But this is not true with products, whether it's physical or digital. And the simple reason is that there's gonna be conceptualizing. There's gonna be production and there's gonna be sales. There's gonna be marketing all of these. They take a long, long, long time. So basically, from the very idea off having a new product reduced or expanding or innovating if you have a product that's a longer process, if you have a service that can be almost instantaneously, yes, you still need to do your marketing. But you're actual service could be out there the very next day, so quite a difference. When it comes to time management products takes longer. Services are quicker products scale well. Services don't scale well, so that leads into the next subject, which is risks. Now. There's some much, much bigger risks when it comes to products for the simple reason that if you have products that aren't selling well, then you are losing money, right? But if you're performing a service that no one is buying, well, that's a period, but you aren't going on minus Well, this isn't necessarily true. If you are bootstrapping your startup and you have a digital product where you didn't need to hire investors or having a big investments in, Well, that means that there's gonna be very low risk except your own involvement in your own time . But the service is gonna be the minimum amounts of risks for the simple reason that a service you perform, you don't perform, people come to you and then they pay you before you perform. But here you first need to have your product and then have people buy the product, and that's when you get the money. So it's quite a bit of a different models. So when it comes to risk, it kind of goes hand in hand with scale ability. Yes, products a scale very well, but also there's risks with that. There's less so when it comes to the digital world, but with services you have a very low set up costs. You have a limited scale ability, but you also have limited risks. The risks comes in when you try to scale within your service and you hire people. And perhaps you're not getting enough customers. Well, that's when you're potentially losing money, and that's when it gets a little bit risky. So when it comes to risks, yes, products are a bit re scared. They come with their own greater risk reward ratio. There's potentially more reward, but there's also potentially more risks. And finally, we need to look at pivoting and pivoting is very important, and it basically means the potential to change your strategy. Now, just like the seasons, markets change and what's hot today on the market in the digital age and what's coming up. For example, artificial intelligence and technology. There might be something completely different in the upcoming years or in 10 or 20 years. Now, remember the smartphone? Simon? It's really didn't sell the PC tablet from Microsoft. It really did and sell. But today these are all hot stuff. They're all selling on the market really well. Now, pivoting means that you're able to change your strategy along with the market, a service dust that super well, no problem at all that say that you are performing psychotherapist services and there's a new model out. Well, you can just develop yourself and get the education for that and then start offering it. Or perhaps it is within the range that you can offer something different that very same day . It's very easy. It's very short from conceptualizing to actually performing, but when it comes to product, you might be very limited within what you do. So, for example, let's say that your Kodak and you're producing great cameras and also producing photos like in the old times. Well, when the digital cameras came code a kind of went out of business and got bankrupt because , well, they weren't able to pay with their business quite as well as other businesses. Where and the digital age, the digital cameras kind of took over. So when it comes to product, yes, the pivoting, it's definitely not impossible. But it is harder. Ah, service will pay with much easier because you're performing it. You can get the knowledge that you need, so you're much better able to adapt both for you and potentially your team. So remember when we're talking about services and products when we talk about digital services and physical services. They're quite different. If you can perform a service over Skype digitally, well, then that's gonna save you a lot of hassle. For example, with set up costs with the time consumption, the risk management's gonna be lower compared to having a physical location needed to the word of mouth marketing, it said. It's gonna be very different and similarly a product, just like we spoke about in an earlier lecture, a digital product in a physical product that come with their own different advantages and disadvantages. So always keep this in mind. And the rules change even further when we're looking at services for B two B businesses and services for B two C, so service for B two B might be far more lucrative than it will be for a B two C. It just depends on what you have. Then there's also the hybrids. You can have a sauce, which is a software as a service when you can manage to develop a prodigy software and then sell the service of using that software for another company. So there's a lot of ways to bend. These bees are not black and white, and these aren't meant to be proper guidelines for right or wrong, this is just to get your thoughts going off. What are you most interested in? And how is this gonna go hand in hand with your idea and your startup? It's all about evaluating properly and seeing it where this might end up down the line if you're looking at scaling and that is something that's very important to you. Well, then I wouldn't limit myself just service. And I definitely would look at possibly digital izing whatever idea and start up, I'm thinking off. Just understand the benefits and the disadvantages off each. And then do your evaluation used checklists, an idealist produce, and you're going to come up with a great idea that shakes out everything at the evaluation . And then you can start looking at getting your start up, up and running. All right, so I'll see you in the next lecture 21. Thank You!: So you've reached the end of the course and I just want to say thank you. Ah, warm. Thank you from me and Jesper for deciding to spend time with us. Now I really hope this course has been very educational and fun for you and that you get to put all of this into practical use for your start up finding the ideas in doing the evaluations. Now, by now, we already have plenty of tips and tricks on how to get creative, how to get inspired, how to find those ideas and then among off the numbers, getting those great ideas. And then we have learned everything on how to evaluate the problem. The solution. The market that includes the Tam Samsung remembered Lord of the Rings character in evaluating the competition and then looking at some additional things such as, Do you want to be in the B two B or B two c market? Or you're looking at a digital or a physical product? And are you looking at a service or an actual product? So I really hope you've enjoyed spending the time here is much as we have enjoyed creating this course for you have fun coming up with new ideas and evaluating them. And then the best of luck to you and your start up and enjoy. Thank you so much in Vibe I