One of the surest ways to fail as an entrepreneur is to run a fake business.
In the online world, most of the people fail because they get seduced by fake business models.
Some of these fake business models include:
Affiliate marketing – Affiliate marketing is a great model to complement your real business if you are recommending products you know are genuinely good. But if the model is in itself solely based on affiliate marketing where you are earning commissions recommending random products and services, then it’s a fake business.
Dropshipping – Dropshipping is a business where instead of running a real e-commerce business, people take the shortcut by creating a website that directs the buyer to the supplier of those products, even though the entrepreneur does not have any idea whether the quality of the product is good or not. Again dropshipping can be good provided you are doing it after thorough research and testing of the products you are directing people towards.
Flipping domains – These people buy a lot of domains and “squat” on them in the hope that someone will be in need of that domain name and buy from them at a higher price.
I can go on and on.
But any business where you are not delivering a TANGIBLE benefit to your customer is a fake business model. By tangible benefit, I mean your product or service should be able to have a noticeable positive effect on your customer.
Your product or service has to solve the needs of your customer and you have to do it DIRECTLY, not by being a middle entity.
This is why the number one way to run a real business is to develop your own product or service.
Yes it’s harder than just recommending other people’s products but that is what it takes to run a real business. Being an affiliate always has to be the secondary model.
This applies to jobs also. One of the reasons I never went into the investment banking world after my MBA in Finance was because I never believed it was a real job. It pays well but you never help anyone directly.
If you are doing a business or job where you are solely motivated by making money for yourself without providing a tangible benefit to the customer, then it’s a fake job or business.
Money should always be a by-product of helping someone else (your customer). That is the only way to make money in a sustainable manner.
I’m telling you all this because I was the number one culprit when it came to taking shortcuts. From 2012 to 2014 I tried my hand at every possible type of fake business.
I would create random websites, fill it up with SEO optimized content, have an affiliate link to a product and get commissions. I even made money in the short-term but I quickly closed down everything because it felt fake. It felt fake because it WAS fake.
That’s another reason why I never like entrepreneurs who are hell bent on starting big. Because a lot of times these people work with the sole intention of making money by getting funding, scaling the business and then selling it. The idea from the beginning is a selfish one. That’s one of the reasons why these kind of businesses have a high rate of failure. Because the intention is wrong. The intention is fake, not real.
I’m not saying there is anything wrong with making money. In fact I’m one of the most pro-capitalist people out there because I feel capitalism is the only system that accurately rewards talent and hard work.
But the irony is that it is capitalism itself that will weed you out if your intention is a fake one. Because even a fake intention will require REAL ENERGY. And where will you get that energy from if the intention itself is not real?
So always strive for running a real business. The number one way of starting on that path is to ask yourself – How can I help someone else?
Let me know your thoughts in the comments below.
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