TL;DR: This Week in The Digital CEO Weekly
β Why a strong business model β NOT great ideas β is what creates longevity in business.
β The 4 monetary models your online business needs for growth, profitability, predictability, and sustainability (and the hidden costs of missing even one model).
From the Desk of James Wedmore:
How you BUILD your business will determine how well your business takes care of you.
This is so important. Most never get this... and they end up closing up shop because it was too hard, stressful or chaotic.
This is why I want you to see me as your BUSINESS Coach first. Not a marketing guy, or anything like that.
Build the business RIGHT... right results come.
In just this realm of "business-building," you probably know I talk team, structure, processes, metrics, and sooo much more.
But today, we're gonna talk about a VERY important business topic: The Model.
The Model matters.
The right MODEL doesn't just make the moola, it makes the lifestyle.
The MODEL is the WAY in which the business "works."
When I've looked into investing into other businesses, I'm not looking for a "great idea" (see, that's what green entrepreneurs do, they focus on the idea), but rather the MODEL.
I've looked into Car Washes (self-service and full service), Coffee Shops, Retail, Storage Units, Service-Based (like trash hauling, etc.), and even Camper Van Rentals.
My criteria for a "yes" was based on the model. And some of those businesses above are GREAT business models... others... not so great.
I ended up settling on a Short-Term Rental Business. And here's why:
- I love real estate as an investment vehicle.
- I love the numbers (profit margins).
- I love that getting a team allows me to scale up more properties.
- (And this is the most important) it can be done almost entirely without me. When the team and structure are in place, my Short-Term Rental business has been almost 100% hands off.
In the Online Brand (Coaching, Teaching, Mentor) Space... I wish we could say the same. There are massive benefits to running a personal brand based business, like...
β Almost zero startup capital is needed.
β It's very purpose and passion-based and extremely rewarding.
β Because the entire business is based on you, there's no one quite like you in the world, is there? That means you technically do not have competition.
But just because there are benefits doesn't mean there aren't drawbacks. Let me tell you, there are drawbacks with every single choice in life, including every choice in business model.
Here's one of the biggest drawbacks: When you run a personal brand business where you are the face, the expert, the brand and the product, guess what? You're also the bottleneck.
This is something I figured out long ago, and it's what I've made a career out of β obsessing over how to uncork the constraints and bottlenecks that exist inherently within this model.
When you are required to market, create content, deliver, coach, and support your clients, you quickly realize that growing this business can require more of you. Inevitably... eventually... there's no more left of you to go around. This is where people plateau or get stuck and stay stopped, and often times ignore the warning signs and head straight to burnout.
This is why the model in how you monetize your personal brand is crucial and vital for your success. What I've done is created a four-criteria checklist of every type of monetary model that must be present and exist inside your business if you want to continue to thrive and keep growing.
The 4 Monetary Models ESSENTIAL for Your Online Business:
#1 Something 100% Scalable
In order for something to be 100% scalable, it means it takes no additional time, effort, or energy from you or your business to attract and fulfill on customers.
#2 Recurring/Renewal Revenue
Recurring revenue is simply an option where someone agrees to be automatically billed in perpetuity until they cancel. Most common example is a membership.
A renewal revenue campaign is slightly different. It's an offer where someone is invited to "renew" and stay in the program month after month or year after year.
Both of these fill the same requirement of keeping a customer in your world longer and creating predictable future revenue.
#3 High-Ticket/High-Profit
I also encourage that everyone have something that is high-ticket or high-profit margin in their business so that they can create quick cash flow and big monetary gains.
#4 LTV Needle-Movers
Any product or offer that is used to increase lifetime customer value (LTV) ticks this box. It could be a low-ticket front-end offer that converts strangers into first-time buyers, or it could be a high-ticket back-end offer that people join after they go through your digital product.
Either way, the point is: When you strategically look at increasing LTV, you've created a healthy, sustainable business.
Now, some people reading this will think I told you that you need four different products.
No, not in the slightest.
You can satisfy these four criteria with as little as two offers, most commonly, sometimes three.
The goal is not more offers; it's an elegant approach to the least amount of offers created that satisfy these four criteria.
And if you have all four of these monetary models in place, you allow for growth, profitability, predictability, and sustainability.
Missing even just one of these, and you start to run into problems:
β No scalable offer means revenue plateaus
β No recurring revenue means no predictable future revenue... always selling
β No high-ticket offer means cashflow problems
β No LTV means always doing the hardest part: selling to strangers
New on The Mind Your Business Podcast:
The 3 Essential Money Skills (and 4 Monetary Models) That Will Make You a Millionaire
I broke this very concept down in GREAT detail in this week's podcast. I think it's so important, so if you want more, click the links below to check it out.
π Listen on the blog
π Listen on Spotify
The conversation Jenni and I have in this episode is relevant at any stage of business, whether youβre just getting started or a seasoned business owner wanting to scale without burning out. These money skills and monetary models meet you exactly where you are in business and light the way for what to do next.
Thanks so much for tuning in this week, I hope you find this helpful!
Cheers,
James
