8 Essentials for Building a Million Dollar Company

Get ready to change your life.

The bank seizes your home. It’s just the latest in a string of infuriating moments. You’ve spent the past few months drowning. Payments are months behind. Creditors call you multiple times a day. You’ve tapped out your credit, and have no way of paying off your $600,000 in debt.

Oh wait. Forgot to mention the divorce papers your spouse just sent over.

This was the overwhelming reality of Howard Panes. You may have heard of him. He’s turned this tragic tale into a billion dollar business. His company, Logic, is the monopoly of the electronic cigarette market.

While his story is special, it’s not outside the reach for any ambitious professional. In this era of the world, this type of rags-to-riches story is up for grabs by anyone.

You can do it too. You just need the right ingredients.

In today’s post, you’ll learn the skills, strategies and characteristics you need to build a million-dollar company.

1. Add Tangible Value

You need to add real value to the world. It’s not enough to just set up shop in a growing industry.  Whatever you’re out there selling -- whether product or services -- needs to enhance the lives of your customers. Otherwise, you’re just wasting your time and the time of others.

In the case of Panes, he didn’t go out and try to be Big Tobacco.

Instead, he found a pain in the marketplace and provided a solution.

Likewise, you shouldn’t worry about trying to become Steve Jobs, Bill Gates or Jeff Bezos. Learn from their successes, but don’t try to emulate it.

Your job is to satisfy customers. Create a product or service that truly fills a void or heals a pain. That’s the only way to build a sustainable and fulfilling business. Take your offer and make it the absolute best on the market. With the right strategy, nothing can stop you.

2. Acquire Strong Distribution

Once you have an offer, you need a reliable way to distribute it to customers. Without this element, you’ll never grow into a $1M business.

Amazon sellers often use their fulfillment program. Uber distributed its technology using the most popular app marketplace. Find where your market goes for offers like yours, then find a way to spread the word through that channel.

With the right network, you’ll be able to safely scale the company.

Without it, you’ll struggle at every turn. Building your own distribution network is very costly, and rarely as effective for new companies. Go where the people already spend time.

3. Gather a Brilliant Team

You can’t build a million-dollar business on your own. It just doesn’t happen.

Even the most brilliant people in the world need others. We all have strengths and weaknesses. Smart entrepreneurs are self-aware enough to hire for their weaknesses and build up a team of people much smarter than them in specific subjects.

"Individual commitment to a group effort--that is what makes a team work, a company work, a society work, a civilization work."

-- Vince Lombardi

The people you hire can either help your business skyrocket, or stall it out. It’s important to find people who align with your core mission.

4. Go Swimming in the Blue

The Blue Ocean Strategy, made popular by W. Chan Kim and Renée Mauborgne in their bestselling book by the same name, simply teaches:

Stop fighting with bleeding competitors in the red ocean. You don’t want to be the bloody shark -- it’s scary. Instead, go out into the blue ocean, the uncontested realms of industries. Become the majestic shark seen from the million-dollar yacht. That’s how you get the right attention of the people who really matter.

The uncontested water have a special breed of problems. You’re trying to find early adopters and educate the market. But once you find product-market-fit, you can grow very fast. After all, there’s so much width and depth out here in the ocean deep.

5. Optimize for Conversions

Scaling is impossible without an offer. This could be a digital service, mobile app or physical product. It doesn’t matter, you just need something of value to stay in the black.

As an early startup, this may seem impossible. But it’s a problem you must figure out.

Optimizing for conversions means setting up the proper landing pages, conversion pixels and metrics. It helps you measure and understand the results of your sales and marketing campaigns.

For the greatest growth, measure and track your cost-per-acquisition. The lower the number, the more power you have to scale the company.

6. Implement a Profitable Sales Funnel

Now that you know your offer and how to track it, it’s time to create an entire sales funnel.

After all, people often require several touch points before making a purchase. Transactions rarely occur from the first interaction. Instead, it takes weeks or months of wooing customers.

Study the process customers use to buy from you.

Then use what you’ve learned to template and accelerate the process. Map out the customer journey, and identify ways you can make their experience more seamless and enjoyable.

7. Know Where and How You’re Spending

When you first start bringing in money, it feels good to spend it.

What doesn’t feel as good?

Staying keenly aware of how much money your spending, and where it’s going.

But as the founder of a soon-to-be million-dollar business, you need to watch your finances like a hawk -- for both funding and profit purposes. You don’t have to be in charge of them yourself, but you should have a clear picture of them at all times.

8. Invest in Smart Acquisitions

One path to rapid growth is acquiring smaller companies. By absorbing competitors, you’ll stand out as a leading solution. With a bit of capital under your belt, you can use this strategy just like major conglomerates do all the time.

Identify your major and minor competitors you could potential acquire as you begin to scale the company. The right acquisition could skyrocket your business to behemoth status.

By investing in these eight steps, you’ll be well on your way to success. What’s your million-dollar business idea?