5 Ways to Make $200 Million
Making a million dollars is the dream of many, starting and building a business worth hundreds of millions of dollars a year. With thousands of new businesses being created each year, a company's ability to truly grow and become a large, self-sustaining business is more important than ever.
It's not impossible to build a hundred-million-dollar business. In fact, many companies like Snapchat, Whatsapp, Yelp, Workday, Salesforce.com, Evernote, Shopify, MailChimp, etc. earn more than 100 million per year. Profit in dollars.
If you want to build a business that brings in 100 million dollars a year, you need to follow some proven strategies. More importantly, you need to understand how your business scales and how much money you can make on average from each customer. In short, your business can be described in the metaphor of hunting animals. Mosquitoes, mice, rabbits, deer, and elephants. And each stock represents a different market with different products.
With a proven strategy, it is possible to build and grow a $100 million company. Zappos.com started by selling shoes online, no one knew how the company would grow, and it ended in 2009. It was bought by Amazon for $1.2 billion.
Every great business starts from scratch and with hard work grows into a great team. No one would have thought that an ordinary Malaysian named Vishen Lakhian could create a website selling meditation courses and eventually grow the business into one of the largest personal development education companies in the world.
Vision is the pioneer of Mind Valley. In 2013, the company reached 40 million dollars in revenue, and today the company has successfully reached 100 million dollars. Not only that, When aims to list MindValley in an initial public offering (IPO) to become the largest technology company in Malaysia.
Therefore, it is possible to start a business and raise up to one hundred million dollars. And basically, there are five ways to build a $100 million business.
For example, if you want to build a company with 100 million in annual revenue. USD, you can.
1. Recruit 1,000 business clients who pay you at least $100,000 per year, or
2. Join 10,000 medium-sized businesses that will pay you at least $10,000 per year,
3. Join 100,000 small businesses and pay yourself at least $1K. USD per year or
4. Engage 1 million active users who pay you more than $100 a year
5. Join 20 million active users and you can earn more than $10 per year.
People in the business world associate this strategy with animals to make it easier to understand. If you have to pay $100,000 for every 1,000 subscribers to make a hundred million, then you are hunting an elephant. If you want 10,000 customers and pay $10,000 each, you're chasing a deer. etc., the remaining three levels are rabbit, mouse, and fly.
So which animal should you have? Or rather, what business sector do you want to be in? Do you want to fly chase to build a hundred million dollar business where you need 10 million customers paying only $10? Or do you want to catch an elephant and you only need 1,000 subscribers, but he needs to pay $100,000?
Well, there is no right or wrong. Let's explore each strategy and how it can help your business create a comprehensive strategy to reach $100 million.
1. Fly fishing
In this business strategy, you need 10 million active users or customers paying you at least $10 per year for your business to make $100 million per year. If you are in the online business world, you need to create an app or get 10 million visitors a year to visit and use your website.
Of course, this is just an estimate and the exact number depends on many other factors such as your conversion rate, your website engagement, the number of returning visitors, and more. However, the fact remains. If you're trying to make $10 per customer, you need a large customer base and millions of visitors to your site every year.
This does not mean that reaching the million-dollar mark is impossible. In fact, many businesses that have been growing at breakneck speed have reached a plateau. This is how companies like Snapchat, Whatsapp, Instagram, YouTube, as well as Google, and Facebook started.
And if you know, all these companies have one thing in common, that is they have a big impact on viruses. Companies like Whatsapp, Instagram, and Snapchat are growing at an incredible rate due to their virality. Millions of people use it, and even if they only make $10 per paying customer per year, they can make over a hundred million dollars per year.
In addition to powerful viral effects, these companies also rely on user-generated content to grow. Another great example is Wikipedia. This is an informational website that relies heavily on user-generated content for its growth. Today Wikipedia is a billion-dollar business.
2. Mouse hunting
With this mouse-click strategy, you should get over a million paying customers and pay less than $100 a year. Again, this number is very simple. If two people visit your site and one buys from you, you need two million visitors to your site because your conversion rate is 50%.
As with fly fishing, you need enough visitors and paying customers to reach your goal of hundreds of millions of dollars. This means that your company still needs a good reputation. Well, it might not be Snapchat or Instagram-type viral, but you still need to get out there and grow your business.
Companies like Evernote and MailChimp are good examples. And if you start an e-commerce business, your business can reach millions of customers, but you need a lot of money, and you need to spend a lot of money on paid marketing.
CNBC once published an article about a 33-year-old man who made a million dollars in just 92 days selling Kevlar pants online through an e-commerce site he founded. This true story proved that it is possible to build a million-dollar business if you take the right steps and follow a proven plan.
3. Rabbit hunting
Next comes traditional rabbit hunting. Most software-as-a-service (SaaS) companies targeting small businesses cost $100 per month, and the average annual per account (ARPA) often approaches $1,000. And in the rabbit hunting business, you only need to pay 100,000 customers, each of whom pays a thousand a year and earns a hundred million dollars from the business.
The most successful software company is Adobe. Adobe is a billion-dollar company and they provide customers with a wide range of products from Photoshop to Flash. Even Microsoft is a software company that uses an original equipment manufacturer (OEM) strategy. Microsoft makes software and uses IBM to distribute it to customers.
The problem with most software companies is that they are not widely adopted and often do not have enough funds for paid advertising. Also, cold calling doesn't work at the "weekly average per account" level. The most important thing is with marketing.
Inbound marketing is a method of driving customers to your product or service through content marketing, social media marketing, and search engine optimization. And for inbound marketing, companies with high NPS need to be highly profitable and focus on niche optimization.
Also, an OEM approach can do wonders for companies that want to catch rabbits
4. Hunting predators
In the deer hunting business, you want to get 10,000 clients who pay you at least $10,000 per year each. The methods described for rabbit hunting apply to deer hunting as well. Traditional corporate marketing efforts are often not enough to earn $100 million when it comes to an annual ARPA of $10,000. And chances are, you still need to generate more than 10,000 leads to turn them into paying customers.
If you hunt deer, the business will be superb. You want each client to pay you $10,000 a year, so you can use the company’s sales team to close deals. Not to mention, you can use similar vendors to generate leads.
One possible way to increase sales to $100 million is to use channel partners and value-added resellers (VARs), where your company has paid attractive commissions to these partners.
5. Elephant hunting
Lastly, you can expand your business by hunting elephants, and selling luxury and luxury goods. Under this business model, you only need to acquire 1,000 customers per year and each customer will cost you $100,000 per year to reach a hundred million dollars in revenue. And usually, your clients will be a large company.
Companies that follow this approach include SuccessFactors, Salesforce.com, Veera, and Workday. Companies following this path have a simpler and more direct approach. After all, you only need 1000 customers. This happens when you have a good solution to a serious and serious problem that big companies are facing.
This is usually represented by a cardiac surgeon or a physician treating stage 4 cancer. Of course, a cardiac surgeon earns a much higher salary than a general practitioner. Again, a cardiac surgeon might represent an elephant-handling company, while a family physician might represent a crab-handling company.
All the five business models mentioned above, whether you catch a fly, a rabbit, or an elephant, if you follow a proven path, and understand your business and customers, you can turn it into a hundred million business.
The reality is that it can take years to build a $100 million business. Beyond that, it will require a lot of capital, problem-solving skills, and hard work to do so. And every business model requires a different set of skills, whether you’re selling physical products through e-commerce or selling software subscriptions.
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