How to Start a Business and Grow it to a Billion Dollar Company

How to Start a Business and Grow it to a Billion Dollar Company


– Fancy homes. Private jets. Condos overlooking the Strip. I’ve had it all. But you know what one
thing I haven’t had is? I haven’t built a billion
dollar company yet. And I’m gonna share with
you how to build one, and the mistake that stopped
me from building one yet. (gentle instrumental music) Most of my friends are entrepreneurs. Similar to me, they’ve done well. And when you look at me, you
think, oh successful guy, nice home, he has money,
he dresses decent. But you know what, compared to my friends, I’m really, really poor. I have a lot of friends whose salary, not business revenue, but their salary is in the hundreds of
millions of dollars a year. I have friends on the Fortune 1,000 list, and people are worth five, 10… Actually I don’t know anyone above 10, but I know quite a few people between five and 10 billion dollars. That’s a lot of money, right? People think millions of
dollars is a lot of money, no, billions of dollars is a lot of money. I’ve seen some of my
friends walk in a Vegas casino, and people are
really sad, and they’re like here’s 50 grand. But you know what? Them giving 50 grand to people is like me giving a dollar to someone. That’s how rich they are when they’re worth five or 10 billion dollars, on the Forbes, or Fortune 1,000 list. So here’s a thing that you need to do if you want to build a
billion dollar business. It’s not about how hard you’re working, or how smart people you have on your team, because you know what, to create a million dollar business, or a
multi-million dollar business, you need that as well. But the difference between
creating a business that does hundreds of
millions, versus billions of dollars is you need
a business that solves a problem for a really big market cap. One of my first businesses
is called Crazy Egg. A lot of businesses are using it. We have hundreds and
thousands of companies that are using Crazy Egg
each and every single month. And what it does is it helps
you optimize your website, so that way more of your visitors convert into customers,
and that’s a decent pain that a lot of people are experiencing. But here’s a problem, and here’s why Crazy will never be a billion dollar business. It doesn’t solve a big enough problem. Now think about Uber on the other hand. They’re solving transportation problems. They’re making it more efficient for you to get to one place, to another, and spending less money doing that, and best of all, you
don’t even have to drive. You can be a poor person, and now you can have a driver just like
those rich people have. Uber is solving a huge problem. It was such a big problem that they increased the market size
of the whole taxi industry. That’s right, before Uber, the taxi industry was actually smaller. They didn’t just take a
portion of the taxi industry, they grew it, and making it way bigger. So if you don’t solve a big problem, and go after a huge market, you’re not gonna create a billion dollar business. Now whatever idea you have,
you have somewhat competitors. It may not be direct competitors, like Uber’s not directly
competing with taxis. A lot of people aren’t like should I take a taxi, or Uber, it’s more so they’re like oh I need to go to a place, I’d rather have an Uber, versus having my own car. Like me, I don’t even drive, right, but when I’m in New York it’s easier to grab a cab, then it is
to grab Uber in most cases. But if you’re not going
after a really big market, you won’t do well. And a lot of people,
and you may be thinking, hey if I wanna create a
billion dollar business, I wanna create this new
category, but no, stop. Sure you can innovate in a sector, but go after something
that’s a really big TAM. If you’re not familiar with TAM, T, A, M, stands for, TAM is total
addressable market size. So if you go after something
big like a Salesforce’s market size, or the CRM market, and lets say they’re worth 50 billion. Will we be bigger than Salesforce? If you dream it, maybe it’ll happen. But chances are you’re
not, but that’s okay. If you’re, you know, 5% of Salesforce, you’re still a billion dollar company. So if you go after something
that’s really huge, like the advertising
space, or the CRM space, or support, or if you
go after transportation, or automation, or trucking,
or shipping containers, how boring that may sound, like companies like Docker, or Dock,
or whatever they are. They’re huge. It’s because they’re going after something that’s totally big. And if you go after a
really huge market size, even if you take 1% of
it, you can do well. I was at a conference the other day, speaking in Arizona, and
a company was holding it. It was called NexCon, and it was held by this company called Nextiva, which offers voice over IP phone services. And they’re already doing over 100 million dollars in revenue. And you know what the founder told me? He’s like, “Neil, it’s
crazy, the voice over “IP market, you know like
those Vonage commercials, “the woo-hoo, hoo-hoo-hoo,
and you pick up the phone, “and you can call over
the internet, those guys? “That market has only 8% penetration.” That means 92% of the people out there are still using landlines. That’s a small market penetration. But that means five, 10 years from now, it can grow to be even bigger and bigger. Yeah Nextiva’s doing
over 100 million dollars, and they’re not even the
biggest player in this space. There’s companies like Ring Central, and Vonage, that are already
worth a billion plus. But as you can see, you probably haven’t heard of Nextiva, yet they’re still making hundreds of millions of dollars. So if you go after a huge
market, you have a much better shot of creating a
billion dollar business. And that’s why you see
me creating multiple products in the marketing space. It’s not that I want four, or five different companies, it’s because I can combine them all, and I eventually will, and I can have a business that’s going after a really big TAM. Total addressable market. And if you go after a big
market, what does that mean? You can have a big company. So if you’re not sure if your idea is going to be big enough, where you can hit that billion dollar
mark, leave a comment, and I’ll respond, and I’ll tell you if it’s a big enough idea. And if you’re unsure, and you need help, go to Google Finance, you can see other publicly traded companies,
and their financials, that’ll help you determine
if idea’s a good idea. You can just type in a stock hold like Apple, AAPL, and it’ll reveal their stock price, and market cap. The other thing you can do is go look at Google Trends, and type in key words related to your space, and it’ll show you how many people are searching for stuff related to your space,
like the word computers. So once you have that
chart, and if it’s huge, you’re doing a good job. If it’s small, you’re doing a bad job, and compare it when you’re
using Google Trends, to the term digital marketing. It has to be at least 10 times bigger than the word digital marketing. And again, if you’re
unsure, leave a comment, I’m here to help you out. Make sure you subscribe to the channel, and I’ll speak to you in my next video.

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About the Author: Oren Garnes

100 Comments

  1. That Woo Hoo Hoo Hoo Hoo made this my favorite video in your series. hhhaha. I've been watching and learning all day. Your content is a gold mine!

  2. luckily I found your channel 😉 I have a fb business page. I wanna be a successful businessperson bt no one support me :). had idea bt cn't use it. will you help me @NEILPATEL
    BEST OF LUCK FROM BANGLADESH

  3. Hi Neil, love your content bro very helpful. Just wondering if you could help me, I want to set up a holiday resort but something that isn’t the same as what is in my whole county so what do you suggest on how to start up? The help would be much appreciated

  4. Don’t have a heavy background in tech but I’m working hard to learn and get my site business off the ground. Unfortunately, I can’t find help. Where do I look?

  5. Hi Neil – I have just launched my new app Social Sports Manager – It produces artwork for people to share on social media. We can monetise from advertising for the free users and subscriptions for the paid users. Is this gonna be a billion dollar company ?

  6. If you are looking for a good quality VoIP brands which is working in all countries contact me
    WhatsApp: +91 9495607291

  7. hey Neil..great content ..u probably have became my idol now….I wish I could think about a solution which can benefit hue part of the population.

  8. Thank you for sharing your knowledge by being REAL! Appreciate your time doing it! I am planning two business one is app development company just iOS development other one E learning space like Lynda.com, Any suggestions would be greatly appreciated! Thank you

  9. I can’t thank you enough Neil, you have a tremendous amount of energy, time and knowledge. You’re always impressing me. May you have time to give me ideas regarding VOIP. If you make it in detail, that means a lot for me. Thank you!

  10. How come you don't use affiliate links to your own businesses when you mention them? I know you have an affiliate program on your website so you must find value in it.

  11. How about custom software development business ? There are millions of companies and freelancers already in this space with latest technologies..

  12. Hi Neil – I m going after the carpooling market in Quebec Canada – then maybe the rest of the world – Would you consider that a big market ?

  13. Nice work.i want to start business in dropshipping or affliate market but i am new dont know what to do

  14. Sir I always check your playlist, and get a great knowledge,sir I want to a beauty parlour entrepreneur mediator ,like Ola cabs, than Google trends innovative ideas from where consume

  15. On demand editing/proofreading service using real humans. The market is anyone that needs to write better from business, students, bloggers…Good idea?

  16. Hi Niel
    Am Nzonda from Cameroon in west Africa, am novice digital marketer.
    I have and project to transform your assurance industry in my country and Africa as a whole
    We want to build and app through which insurance clients could pay their insurance without going to the insurance company.

    We aim to digitalize all the processes from start to end with the next 5 years.
    Let me know what you think about my project.

    Thanks.

  17. Hi neil, im starting up a worpdress maintenance agency since its the only skill i have for now. Is it a good thing to start small then eventually go for that big market size? Or what could advice? TIA

  18. Hey man!!
    I was working SEO executive in Digital Marketing company but now I say bye bye to 9 to 6 job..
    Then I registered my OPC company.
    I only focus SEO Services, not any other ppc or social media marketing..

    Will these type of company become multi million dollars company?

    How can I succeed more enough in one single niche?
    Plz reply..

  19. Sir i want to start my own company of digital marketing and of different things so can you please help me on this? And also can you please tell me which are the some new ideas or niches on which i can start a company? Please help me sir.

  20. hi, neil, am entering into affiliate marketing niche and just got my website set up, is it worth a billion dollar market to enter?

  21. The biggest sign that I have noticed in successful personalities is they always try to be in touch with their supporters. Neil Patel also does the same. 😊

  22. HEY Neil! I've made about $900 with fiverr. But due to a problem, i'm no more making money on fiverr. I don't understand how to use that money. Can you please suggest me (in short) what steps should I take in order to make about $100-$150/day? Thanks for your time Neil 🙂

  23. Hii sir please tell me are you indian because the sur name patel belong to india then why did you leave india plz tell me and do you know Hindi we miss you … Your are great plz tell about india or usa story

  24. Sir, I am mechatronics engineer.I wanted start any business startup. How to develop my business knowledge? Can I duplicate any business which is available in market and give their solutions /services?

  25. Hi Neil, Thanks for sharing this great piece of content. I am about to launch an product, which is aimed to build online rental platforms to customers who want to start online rental business of their own.

    According to you does it have a good TAM?
    How I should position it into market?
    How I can get leads and nurture them, so that they convert ?
    I am ready with landing page, which is quite good. But, What I shall do to drive relevant traffic to it ?

    Please help, I'd be very grateful. Thanks in advance 🙂

  26. Thank you for the inspirational videos. Can a small company afford to hire your team to help with our online presence? We can use the help. We have an amazing family center that is doing well but needs to recapture a local market. Help! I am of the generation that is not familiar with all of the blogs and SEO– it makes my head spin!

  27. Hi Neil – First of all, great video! I have always wondered how I could start a billion dollar company and you just answered my question. I’ve started my own coffee brand. Would that be considered a huge market?

  28. Hello Neil, I always enjoy your contents, I'm a web developer and I want to launch a business of web design /development, and I've adviced to focus on a specific niche , should I or not? it would be really nice if I can get some ideas from you . Thanks😊

  29. What about starting a Clothing Brand like Levis or UCOB? As manufacturing clothes is my family business, but it's on a very small scale, and we don't even have our own brand. What if I create my own clothing brand and scale it?

  30. Hi Neil, do you think creating a E commerce website platform for retailers would be a good idea? Just like Alibaba, it focus on wholesale new platform focus on retailers.

  31. I’m 15 right now, I’m currently starting an online ecommerce business. I have learnt more in the last month than my whole life. I am living in the uk, and have a few good business ideas to start after I’ve made some money and I’ll get on with them. I’d love to move to the USA one day. Hopefully in a few years assuming everything goes well. You’ve helped me massively progress towards my dreams. I don’t massively fit in in the uk because I am very conservative and I do shooting and will pursue that more in the USA but here everyone is always trying to tell people that they can’t. They can’t succeed, they can live a better life working for someone else, whatever shit they say is silly. I will prove them wrong one day when I have solved huge problems that may even affect them. Then who’ll be laughing? Eh? Anyway, thanks for the tips. One day I will look back at life and without these videos I wouldn’t have succeeded. Ps a school teacher of mine was an entrepreneur before he had to stop because of family issues and became a teacher. He was worth about £25 million. Great mentor aswell. Good guy.
    Anyway, thanks for reading and thanks!

  32. Man, You're awesome! Thank you very much for being such an awesome entrepreneur! I listen to your podcasts, youtube videos and read your guides on quicksprout. Cheers from your #1 fan in Brazil, Lucas!

  33. Hi Neil, is SMS marketing a better way to handle clients over email marketing given the fact that the open rate of SMSs are higher than emails?

  34. Hi! How are you Neil! You are my to go to guy 🙂 This is my new business idea. I'm getting in to pet supplies. That's a huge market but my competition is even bigger. We are different then others, because our pets beds/caves and toys are made out of 100% wool in Nepal, without any chemicals and dyes. They are hand made and eco-friendly. What do think of that? Thanks, Kamila

  35. by Neil I have this idea of revolutionising the online products industry through faster and better transportation could that be a billion dollar business idea

  36. Thanks for idea! my passion mostly in music. Music as consumer product and another industries which have direct connection with music itself (instruments- accecories etc) so what kind idea you think.I can try ? And how long trial should be last for getting right conclusions? Thanks a lot

  37. Hi Neil. My "crazy" idea is to target the Latino market here in Southern California with a Spanish-language news site. I really recognize that Spanish is still a dominant language among many Latinos here in the Inland Empire and represent million$ – perhaps 10's of millions – in spending power. Here's where it gets "crazy." I'm African-American and everyone keeps telling me to stick to my own "kind" if I want to launch a successful business. Am I the only one who sees the true potential here?

  38. Neil, how about automation for Siemens Teamcenter? Using an open source software through SOA to automate testing after deployment on the Teamcenter platform?

  39. Hey Neil, What do you think about eCommerce (Targeting 1 city).
    I mean where i live. Does it make a difference if you offer same day delivery or exciting products that you're getting from the local market

  40. The Art Market, I run a company that can revolutionize the way people use see and purchase art. I would love to talk to you about my business model with the right mind we can reach some Bezos levels interested? Just hear me out this is not an ad or a BS comment

  41. Mexico is one of the places where one can be rich quick the reason is the society do things together , If a Mexican find his neighbour selling corn in the front gate he starts too . So if you creat a necesity defently you will make billions of dollars

  42. What are your thoughts on a CPR first aid business. It's always a need for it so I am trying to start a business offering that

  43. Hey Neil.. I am a 22year old rice trader from India.. My idea is to build a digital freight forwarding company… If you can give your view on this topic.

  44. Hi Neil,

    Thank you for videos and sharing so much information. What about the food industry? Superfoods and organic products.

    Thank you.

  45. While taking feedback from others about my business idea, should i fear that others can steal my idea and implement it before me?

  46. Hey neil^^ I've been planning to make a voip startup. My concept is very technical but the basic idea is to make a voip service similar like Skype so basically using wifi to initiate calls however it's supposed to be a voip software that works seamlessly with the smartphone itself rather than through an app so you can initiate calls by touching a sensor at the side of your phone like on the s10 that's not all of course. The end goal is to say goodbye to phone numbers thus reducing phone costs

  47. how about the entrepreneurship market? I mean to tell people the way and the skills they will need. thank you

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