The Value Creation Master Class

A workshop with Seth Godin, on Udemy. Launched, fall 2016

There are two ways to engage with the ideas in this Master Class.

The first is to use it validate your current idea, your current approach to the market.
If you’re not achieving the impact you seek, it may because your understanding of
the value you create is incomplete.

Action item: Be honest and direct with yourself about how others see what you’re
building. Revise, rebuild and revisit.

The second is to use this Master Class as a way to invent a new idea, a new sort of
value you can create. Working backwards is actually the best way to move forward.
See the end, visualize the impact you seek, then invent and build something that
can deliver on that goal. As marketers, we make promises and we keep them. This
Class helps you get comfortable with what sort of promises you ought to be
making. At the end of this workbook, you’ll find some questions that might help you
get started.

GETTING STARTED:
Watch the first few chapters of the Udemy video. Once you understand the concept
of value creation, print this out and work your way through it as you watch each
chapter of the video.

The best results come from doing two more things after you’ve finished the video.

Print this out again and go through the video again, digging in deeper with
your answers. This is a safe place for you to share your vision.

Then, do it one more time, but with a team, a mastermind group, with your
investors or your colleagues.

If I use a term you’re not familiar with, look it up online. For a lot of people
interested in making change happen, this is new material, and there’s a lot to be
gained by understanding both the concepts and the vocabulary.
Please remember: It’s okay to be wrong. It’s okay to answer with incomplete
information. It’s okay to speculate, to describe a world that you’re imaging, to draw
the picture before it’s done. That’s precisely the correct way to engage in the
thought experiments that will help you refine your vision.

The work isn’t hard, but it takes effort to see the world in a new way and to honestly
assess where you are and where you’re going.

PRINT THIS OUT!

It works better if you write things down.

It works better if find a buddy.

It works better if you do it out loud.

This is a master class. No handholding, just a clear path to help you get yourself
from here to there. Do the work, do it in a team, do it in writing…

Thanks for being part of this, and thank you for caring enough to make a
difference…

Seth

Seth Godin’s Master Class on Value Creation on Udemy 2

The questions within:
INTRODUCTION: What sort of value do you create? ........................................................................................ 5

Who is it for? What mindset and worldview and situation? ............................................................................ 9

Is it paid for by organizations or individuals?................................................................................................ 10

When a person at an organization buys this, what will she tell her boss? When an end user
engages with you, what story will he tell himself, or his spouse? ................................................................. 10

Does it solve a new problem or is it another/better solution to an old problem? .......................................... 11

In two sentences, what’s the problem you solve? Not for you, but for the user? ........................................... 11

Do the people you seek to serve know that they have the problem you can solve for them? ........................ 14

Are you leveraging an asset that others don’t have? ..................................................................................... 15

Are you hiring talent and reselling it at a profit? ........................................................................................... 16

Are you combining the previously uncombined in a way that’s hard to duplicate?....................................... 17

Are you building a technology that will create its own inertia, disrupting existing value chains
and improving as it goes? ............................................................................................................................. 18

Are you doing something that others can’t do, or won’t do, and will that continue? Really? ........................ 19

If you’re solving an existing problem, are you hoping that people will switch, or is the goal to get
users who are new to the market or unaware of existing solutions? ............................................................. 20

Do you need a salesforce? What percentage of the value that’s created for your customers is
created by talented salespeople? .................................................................................................................. 21

How will people find out about the solution you are offering? ..................................................................... 22

Are you a freelancer or an entrepreneur? ...................................................................................................... 23

If you’re selling to organizations, what will your customer tell the boss? ..................................................... 25

How long is the sales and adoption cycle? Can you wait that long? .............................................................. 26

Seth Godin’s Master Class on Value Creation on Udemy 3

If you’re building a brand, how long will you have to invest (lose money in building trust and
awareness) before you profit (generate profit margins that make up for your investment)?......................... 27

Is there a network effect? .............................................................................................................................. 28

Are you building a natural monopoly?.......................................................................................................... 29

Is there any reason why your customers won’t simply switch to a cheaper alternative? ................................ 30

How much better do you need to be than the status quo to get someone to leap and switch to
your solution? ............................................................................................................................................... 30

What are the externalities and side effects like? How will the establishment of your solution
change the market, the environment and the culture? ................................................................................. 31

How long can you sustain this? What happens when the market changes, or you do? ................................. 32

What’s the value you create over a lifetime relationship with a customer? .................................................. 33

Who do you seek to serve?............................................................................................................................ 34

What do they dream of? Aspire to? Pay for? .................................................................................................. 34

Do they have problems or challenges that you know about that they don’t? (When Google came
along, few people thought they had a search problem.)............................................................................... 34

What’s their narrative about the new, the next, the possible? ...................................................................... 34

What’s their narrative about money? ............................................................................................................ 34

These people you seek to serve, who do they trust, who do they look up to? How can you let
them know about your ability to help them? ................................................................................................ 35

How can you engage with the few that seek the new, and give them the tools to tell the others? ................ 35

Seth Godin’s Master Class on Value Creation on Udemy 4

INTRODUCTION:
This project you’re working on, the new business or offering, what sort of
value does it create?

This is a loaded question, and I hope you won’t answer it until you’ve watched the
entire video through at least once.

What we’re seeking here isn’t a fancy elevator pitch or a carefully compressed
mission statement. Instead, the challenge is to describe (without regard in any way
for how you benefit, or for how your organization profits), precisely what’s in it for
me.

What do you provide that makes me feel better? What do you do that gives me a
story that helps me with my boss or my spouse? In the words of Michael Schrage,
every successful organization helps people change, change from where they are to
where they want to be. What do you change? Is it a change that you want me to
make or one that you have evidence that I want to make?

Here are two samples:

[As you read these, check out the websites of Askinosie and Acumen to see if their
words and pictures support their respective value creation narratives.]

Askinosie Chocolate creates value for our retail partners by offering them a product
to sell that’s not available at Whole Foods or other chains. In addition to being
exclusive, the product has shelf-friendly packaging, a salesforce that’s easy to work
with, generous credit terms and a customer base that’s willing to go out of its way
to find us.

Our margins are fine, and they don’t have to be the best because our
partner/retailers understand that good stuff is worth it, especially if the store down
the street isn’t undercutting our price.

And it’s good stuff. Beautifully crafted, consistently delivered, professional and with
great appeal.

It’s worth noting that we are unable to deliver value to the retailer who insists on
paid shelving allowances and maximum sales and profit per square foot in the short
run. We build their vibe and their base, not deliver the highest margin item in the
store.

We also create value for our end customers, the folks who eat the chocolate. They
fall into two categories:

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One customer hears our story about dignity and connection and falls in love with
what we are doing. Our direct support for farmers in Tanzania and the Philippines,
the school programs we run in Missouri, Shawn’s spiritual work with the monks—all
of these add up to a powerful incentive to be part of something that moves
forward. The fact that the packaging reminds our customers of other valued
purchases and that the experience of eating the chocolate is fun only goes to
further the self-narrative that the customer can do good by eating something that
brings a smile.

As the competition for “chocolate that does good” gets crowded, this customer
wants more connection and awareness with our good work, and our ability to
deliver (and deliver on) that narrative is how we will continue to give them value.

The other customer is a chocolate snob, but in the best possible sense. We create
value for him by being one of the pioneers in bean-to-bar chocolate, consistently
delivering a really delicious chocolate that also happens to be made by real people
in a real factory.

We share this story in a way that is easy to visualize and talk about. We win awards
and need to win more, because those awards are a clue to this customer that our
chocolate actually does taste better.

Seth Godin’s Master Class on Value Creation on Udemy 6

We don’t add any value to someone who wants cheap chocolate, or hard-to-find
chocolate or ridiculous and funky flavors. We don’t help people look cool, get a
date or buy something that reminds them of their childhood. That’s okay.

Acumen is a fifteen-year old agent of change, a pioneer in changing the way

poverty is seen and addressed.

Our non-profit raises money from neo-philiac (new-seeking) philanthropists,

people who are already committed to funding important, effective ways to
significantly impact poverty.

We focus on funders who are looking for new efforts on the frontier, and who have
the insight to understand the intricacies of our model and the patience to stick with
us for years, not weeks. That patience actually feels valuable to them, because they
have the narrative that they’re not easily swayed by manipulation.

They get value out of the effort of fighting poverty. Not in merely writing a check,
but in understanding the essence of a new approach. Results are important, but
results aren’t the value that they’re seeking—we don’t address the endless
emergency of poverty, we don’t traffic in proven but inefficient techniques. Instead,
we offer them the satisfaction of being pioneers in bringing leadership and new
approaches to our oldest problem.

These funders gain value in learning about approaches that are new to them. And
we create value by giving them new things to learn.

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They enjoy teaching their peers about what they’re doing. We don’t offer a lot of
galas, or social proof, or status. We don’t play the emergency card. We partner with
our donors, we don’t pitch them.

And the philanthropists value our transparency and also get satisfaction from being
trusted partners, being rewarded for their efforts and insight, not merely their money.

In both cases, it’s worth noting:

The value creation isn’t as obvious as you might have guessed.

The audience for the value created is smaller than expected.

The effort to continue delivering more value is significant.

The concept of the obligating question is worth thinking about. Imagine an honest
conversation with someone you’d like to deliver value to. The question is, “If this
product could create that outcome, would you buy it today?”

An honest answer to this question is rare indeed, but you can definitely have that
conversation in your head. It gets past all the mistrust, all the objections, all the
pretend obsession on specs and gets to the heart of it. “Who do you want to
become?”

Use this space or your own doc to answer each question,

beginning with “what sort of value do you create”. But do it in
writing…

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Who is it for? What mindset and worldview and situation?

The job title or other demographic isn’t particularly important, unless it really
overlaps with the psychographic, with what this person believes, hopes for and
assumes.

Is your product or service for someone striving for something? In transition? Does
the value lie in making a change happen for that person, a change that they
desperately want?

Or, perhaps you are selling a solution to an urgent situation, or a possibility of

belonging, or the chance to avoid exclusion…

One shortcut here: List the brands, causes and conversations that the kind of
people you seek are engaged with:

If you can tell us who it’s for and the way they will interpret the value you’re offering,
you’re halfway there.

Seth Godin’s Master Class on Value Creation on Udemy 9

Is it paid for by organizations or individuals?

Organizations pay for a certain kind of value. Individuals, on the other hand, have a
very different relationship with money. By getting to this early, you can be clear with
yourself about the value creation.

Organizations don’t buy things, people do. When a person at an

organization buys this, what will she tell her boss? When an end user
engages with you, what story will he tell himself, or his spouse?

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Does it solve a new problem or is it another/better solution to an old
problem?

If it’s a new problem, you’ll need to do a lot of work of explaining to me that the
problem you see is actually a problem I want to have (this persuasion actually
creates value, because now that I know I can make things better, I can take action.)

Of course, a lot of people don’t want to know that they can make things better,
don’t want to be persuaded that a new problem is actually problem. You create no
value for these people by pointing it out to them.

That’s because they don’t want to deal with the fear and uncertainty of solving a
problem. They don’t want to explain to their boss that the status quo that they’ve
happily been living with was defective. They don’t want to get blamed for not
knowing about the problem, and not blamed when the supposed solution doesn’t
work. Mostly, they get no value out of working to make a change happen.

Therefore, if you are hoping to create value by solving a new problem, you can only
be successful in working with people who like finding new problems.

It’s a very different market of people who want a better solution to an old problem.
These folks find value in going first, or value in getting ahead, or value in not being
left behind (three different things, by the way).

When in doubt, remember that culture is driven by the simple unspoken statement,
“people like us do things like this.”

In two sentences, what’s the problem you solve? Not for you, but for the
user?

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Will a few users pay a lot, or will a lot of users pay a little?
Later on, we talk about lifetime value. But right now, what’s your instinct? For many
people, it’s fun and easy to keep running around looking for more prospects, more
customers, more places to pitch.

While it might be fun to imagine a project where a lot of people pay a lot, that’s
pretty rare (the iPhone being an amazing exception). And a project where a few
people pay a little isn’t much of a project.

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So, in order to build this into what you seek, you’re going to have to pick one of the
other two quadrants: Either a solution that a few people will stick with for a long
time, one that creates huge value but needs your focus on this small market—or,
something more widespread, that must catch on, where most users don’t pay very
much at all.

There’s a corollary here: If you choose to commit to the smaller group, the intimate
relationship you have with your customers means that you will spend time making
products for your customers instead of seeking customers for your products... Go
ahead and elaborate on which posture feels right to you…

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Do the people you seek to serve know that they have the problem you can
solve for them?

Before someone is able to engage with you, he or she will have realized three
distinct things:

• Know that there’s a problem

• Knowing it can be solved

• Knowing that you can solve it

Of course, internet search gives people in our modern age clues about all three.
But not if they’re not motivated to google the question in the first place.

And if they do, do they find you as the answer? Not likely. Winning that SEO game
is tricky indeed.

Which means that a big part of being a remarkable marketer is packaging not just
the solution, but the problem as well.

When I launched permission marketing and the commercial email revolution that
came with it as part of Yoyodyne in 1991 (yes, 25 years ago), a huge part of our
marketing effort was in going to conferences to give talks about a solution to a
problem people didn’t yet realize was a problem.

Use the space below to outline which people believe they have this problem. How
did they come to know this? It’s essential to distinguish between the large number
of people who have the problem and the few who know they do.

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Are you leveraging an asset that others don’t have?

It should now be pretty clear that this isn’t a one-day, make a phone call and you’re
done sort of thing. It’s a journey. The question here is: Can you defend your value
proposition enough that it’s worth investing so much in building it?

Particularly for expensive or complex solutions, particularly in a b2b setting, there’s

a huge advantage to being the only one, or the one who has a tool or a technology
that is more easily leveraged than what the competition has.

This might be real estate (a better location for your restaurant). Or it might be a
really expensive color printer that the copy shop down the street can’t afford so
they can’t keep up with you. Or it might a mailing list or other permission asset that
gives you the ability to reach people others can’t.

It’s certainly not required. There are book packagers and house painters and
freelance jugglers who have only their brand name and their portfolio of work as
their insulation. But if you can build an asset, you should.

What’s your asset?

How are you leveraging assets that others don't have?

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Are you hiring talent and reselling it at a profit?

This is often the opposite of building the kind of asset you can actually own. You
have employees or contractors, they charge you X, you bill them out at Y and keep
the difference.

Obviously, you’re going to need to do more than that to deliver more value than
the alternatives do. A race to the bottom is a grueling competition, one that you
don’t want to win.

So, what are you going add? Are you in the customer service business? Do you
have a different guarantee, systems approach or expertise that others can’t touch?

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Are you combining the previously uncombined in a way that’s hard to
duplicate?

I really enjoy the insight that this question can give you. I hope it’s clear by now that
creating the perception of value (which, since value is always about the perception
of the user, is precisely the same as creating value) is not easy, because most
people aren’t rooting for you or giving you the benefit of the doubt.

So, if you’re merely moving people around or solving a problem that’s already
been solved, how can you possibly do this?

One approach is to use take advantage of many of the new tools that are now
arriving. You can be more transparent than the alternatives. You can move data
instantly, create dashboards, make significant leaps in time to market and other
KPIs for your clients.

Airbnb isn’t selling anything different than a room2rent ad on Craigslist (and

Craigslist doesn’t offer anything different than the local classifieds before it). The
difference is the combinations, the user experience, the certainty and the ability for
the user to tell herself a fundamentally different story.

How are you combining the previously uncombined in a way that's hard to
duplicate?

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Are you building a technology that will create its own inertia, disrupting
existing value chains and improving as it goes?

Truly pervasive technology takes a little while to get going, but then it doesn’t stop.
That’s because as it creates value for one user, it also impacts other potential users,
causing them problems until they adopt it

That problem might be as simple as the unhappiness caused by knowing that you
have a problem now and that you could solve it if you wish.

More likely, it’s the problem that you feel as though you are being left out or left
behind.

A successful trade show causes a problem for all the businesses that don’t go to the
trade show, a problem they didn’t used to have. Value is creating by going.

A communications tool isolates the non-communicators, and as it gets better and

more streamlined, as the communications get more effective, it creates ever more
value both for the users who are currently using it, and as a deliverable for the user
who finally does.

1. How will your technology disrupt existing value chains?

2. How will your technology improve as it goes?

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Are you doing something that others can’t do, or won’t do, and will that
continue? Really?

Yes, we just went over the same question at least three times. That’s because this is
where the empathy kicks in. We know that you’ve worked really hard to get to this
point, and we know that you can see all the differences between you and your
competition (and yes, everyone has competition, even if the alternative is, “do
nothing.”)

But just because you can see the difference… it’s not enough.

One thing I’ve discovered in working with freelancers is that they are sure people
should hire them—and when I then ask them how often they hire and pay
freelancers in the same way they’re expecting others to hire them, I get a blank
look.

The difficult work here is to embrace the fact that no one you’re seeking to
influence thinks as you do, knows what you know, is as committed to your work as
you are. And so the empathy.

It turns out it’s the soft stuff, the attitudes and the empathy and the posture that
people respond to, not the ability to answer a FAQ.

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If you’re solving an existing problem, are you hoping that people will
switch to your solution, or is the goal to get users who are new to the
market or unaware of existing solutions?

I’m repeating myself a little bit, on purpose, because this is the trap.

Askinosie Chocolate needs to make a choice: sell chocolate to people who love
delicious chocolate (or heartwarming stories of capitalism gone right), or try to
reach people who didn’t even realize that this is possible.

The most talented product developers and marketers are evangelical about their
work, and that’s why it’s often so difficult for them to get started. They think their
genius is for everyone, when, if they’re honest, they’ll realize that they’d be
fortunate if it were merely for someone.

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Do you need a salesforce? What percentage of the value that’s created for
your customers is created by talented salespeople?

Zig Ziglar famously sold pots and pans door to door. Good pots, no doubt, but is
there any debate that almost all the value was created by the salesperson, not the
pot?

Most B2B success stories begin as engines for a sales team. Most of the products
you see on various TV reality shows succeed because they were on TV, not because
the product was brilliant. P&G and others created billions of dollars in value by
selling average stuff to average people using the power of 1960s TV.

Today, we still have the chance to grow something with a field team, with feet on
the street, with kindness and empathy.

But if you’re going to do that, plan on it. Invest in it. Build it into your pricing and
your timing.

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How will people find out about the solution you are offering?

No magic is likely to happen. There isn’t a better mousetrap, and even if there
were, no one is beating a path to your door (if they were, it’s unlikely you’d be
working through this course.)

Every once in awhile, someone gets lucky and gets picked. They get featured on a
magazine cover or they make an early sale that pays huge dividends. But most of
the time, word of the value you create doesn’t spread on its own, not easily, not
when you need it most.

If you hope that people will find you via word of mouth, shared experiences and the
honest recommendation of friends and strangers, then you’ll need to build that into
the product or service itself. If ideas that spread, win, then your job is to build
something that will spread.

Your job is to concentrate the goodwill you’re creating, distill it into the right story
for the right user, and share it in a way that changes people. And then, as you gain
traction, your users can tell those stories to their peers, to others who will gain value
from you and then become users.

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Are you a freelancer or an entrepreneur?

Here’s what I wrote on Medium about the distinction:

A freelancer is someone who gets paid for her work. She charges by the hour or
perhaps by the project. Freelancers write, design, consult, advise, do taxes and
hang wallpaper. Freelancing is the single easiest way to start a new business.

Entrepreneurs use money (preferably someone else’s money) to build a business

bigger than themselves. Entrepreneurs make money when they sleep.
Entrepreneurs focus on growth and on scaling the systems that they build. The
more, the better.

The goal of a freelancer is to have a steady job with no boss, to do great work, to
gradually increase demand so that the hourly wage goes up and the quality of gigs
goes up too.

The goal of the entrepreneur is to sell out for a lot of money, or to build a long-term
profit machine that is steady, stable and not particularly risky to run. The
entrepreneur builds an organization that creates change.

The trap is simple: Sometime freelancers get entrepreneur-envy and start hiring
other freelancers to work for them. This doesn’t scale. Managing freelancers is
different from being a freelancer. Managing freelancers and saving the best
projects for yourself gets you into trouble. The cash flow gets you into trouble.
Investors don’t want to invest in you because you can’t sell out if you’re a freelancer
at heart.

If you’re an entrepreneur, it is impossible to succeed by using your own labor to fill

the gaps. That’s because your labor is finite. It doesn’t scale. If it’s a job only you can
do, you’re not building a system, you’re just hiring yourself(and probably not
paying enough either).

This problem has been around for awhile, and it’s tempting to think that more effort
can let us solve it — that we can be both. New tools give freelancers more leverage
than ever before, and our culture continues to push us to get big, right now.

The thing is, more effort can’t solve this dilemma for you. Sooner or later, more
effort doesn’t scale. Travis doesn’t drive the Uber that picks you up, Sheryl doesn’t
do any coding and Jacqueline can’t work with every investment, every day.

The solution is surprisingly easy.

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If you’re a freelancer, freelance. Figure out how to do the best work in your field,
the best work for the right clients. Don’t fret about turning away work, and don’t fret
about occasional down time. You’re a freelance for hire, and you need to focus on
your reputation and the flow of business. Find leverage in the form of assistants and
outsource the commodities if you can,but your work is always going to be your
work.

Freelancers get ahead by becoming more in demand, by charging more (and

being worth it). They get ahead by being more connected, smarter, more effective.

If you’re an entrepreneur, don’t hire yourself. Build a business that works, that
thrives with or without you. It might not be good for your ego, but it will be good
for your bank account.

It’s possible to switch hats, to have side projects, to have two ‘jobs’. But we can’t
wear both hats at the same time, can’t freelance our way to entrepreneurial success.

Up to you…

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If you’re selling to organizations, what will your customer tell the boss?

In B2B selling, this is where every single failed value creation offer fails. When the
seller (that’s you) can’t articulate the internal discussion that needs to take place
before a yes happens.

Who has to go along? Who needs to champion it? What are the stated and
unstated fears? What’s the reason not to wait a cycle or two?

All the objections about budget and timing are a smoke screen. The real objection
is: I can’t get my boss to take responsibility for this change, and I don’t want to.

You don’t get a chance to create value if your prospects can’t see, or worse, doesn’t
care enough.

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How long is the sales and adoption cycle? Can you wait that long?

If you’re trying to deliver value by creating real change, be prepared to wait.

Technology products like Twitter take years to catch on. Just about everything that
isn’t a fad, actually, takes years. And true cultural change (like giving up cigarettes)
might take a generation.

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If you’re building a brand, how long will you have to invest (lose money in
building trust and awareness) before you profit (generate profit margins
that make up for your investment)?

Let’s recap for a second: you can create value if you’re not know, if you’re not
trusted, and if people aren’t ready to make a change to engage with you.

But how do you achieve that?

Brand is a shorthand for, “the promises that people expect you to keep.” So, when
someone needs that promise kept, they think of you.

Almost all brands go through a cycle of investment before they are able to
significantly benefit (harvest) from the seeds they planted. Of course, this requires
time and money.

Are you organized to overinvest early in making big promises and keeping them, in
a presence in the media and the market, earning trust long before you have the
cash flow to pay for it?

Either way, building a brand is not a simple process. You want a position in the
marketplace, one where you are valued. What’s it going to take to earn that
position?

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Is there a network effect?

Network effects are what happens when a user says, “you know, this would work a
lot better if other people were using it too.” And so, there’s an inherent benefit to
spreading the word.

There aren’t strong network effects for most things that create value. This restaurant
would not be better if everyone you know came here every night. This beach
wouldn’t be better if it were more crowded…

On the other hand, when you build a platform, when you connect people, when
there’s a tribe that’s moving forward, it often happens that people get more value
when the others are on board.

How can you add a network effect to the service or product you deliver? Not add it,
but build it in?

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Are you building a natural monopoly?

Writ large, the network effect can lead to a natural monopoly. This is an innovation
that works so much better as a behemoth that it makes no sense for there to be
competitors. We don’t need two competing phone networks, just one way to call
everyone. Communication tools are great candidates for this—industry conventions,
for example, work better when everyone goes to one of them. Same with awards,
certifications, etc.

If you’re confident that you are creating the one and only, write it down here. Tell us
why and how that’s going to happen.

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Is there any substantial reason why your customers won’t simply switch to a
cheaper alternative?

Okay, back to understanding how value is perceived. If all you do is solve a

problem that others can solve, are you in a race to the bottom? (Which, alas, you
might win, or worse, come in second). If you got people to switch to you by being
cheaper, what makes you think they won’t switch again to someone cheaper still?

Walmart made a significant bet that their supply chain would allow them to be the
cheapest for decades (and they were largely correct). Most organizations,
particularly small ones, can’t make the same bet.

So, how do you create value that isn’t merely a replaceable contribution?

How much better do you need to be than the status quo to get someone to
leap and switch to your solution?

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What are the externalities and side effects like? How will the establishment
of your solution change the market, the environment and the culture?

Some externalities aren’t really your problem, and they might even be a good
thing. We don’t have horse-drawn carriages and hardly any travel agents either.
They disappeared because more value was created by an alternative.

It’s beneficial to focus on the value you create, but as you go to market, it’s also
worthwhile to think hard about the effects that this value will have. By
understanding who comes out behind, you’ll get a better understanding of how the
risks and costs of switching to the value you seek are seen by others.

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How long can you sustain this? What happens when the market changes, or
you do? The Dip will happen, do you need more resources or a smaller
target?

Hint: It’s not a sprint.

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What’s the value you create over a lifetime relationship with a customer?
Does that lifetime value establish a need for an endless supply of new
customers, or are you able to heavily invest in just a few?

People in business say “lifetime value” a lot, but rarely pause to consider what it
means.

Your project—it exists to create value. Value for who? For how long? When you
multiply the daily value by the number of days, you can get a sense of what it’s
worth, to the user and then, of course, to you.

These long-term calculations understand what’s possible for each of us when we

set out to create value. When Bezos picked $33 as his number, it was a vision for
the future, but it also served as a compass for his team. Once you realize that your
job is to earn back that investment, you can view customers as co-creators and
partners in a longer-term journey.

I’ve used Google every day since, probably, 2000. That’s 5,840 days. If each day I
generate, on average, a dollar of value for Google, I’m worth a ton. And how much
value do I get? Hundreds of thousands or millions of dollars worth (compared to no
search.).

Not for something as horizontal and widespread as Google, but for the small folks,
for the focused, the vertical, the people no one ever heard of except for those that
matter.

How much value can you create for the smallest possible universe of customers?

And how can you help them, encourage them and reward them to tell the others?

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And a simple series of questions for your next idea, for helping
you invent something that you can run with:
Who do you seek to serve?

What do they dream of? Aspire to? Pay for?

Do they have problems or challenges that you know about that they don’t?
(When Google came along, few people thought they had a search
problem.)

What’s their narrative about the new, the next, the possible?

What’s their narrative about money?

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These people you seek to serve, who do they trust, who do they look up to?
How can you let them know about your ability to help them?

How can you engage with the few that seek the new, and give them the
tools to tell the others?

We need what you’re working on... and focusing your solution makes it far
more likely that it will find the traction it needs. Once you’re strategic about
the value you create and the problems you solve (and cause), you can
begin to focus on delivering on those promises.

And then, pay it forward and teach the next person what you’ve learned.

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