The Pros and Cons of Digital Product and Education Businesses vs. Traditional Businesses

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1. The easiest business to start and make a million dollars a year is also the hardest to scale to $100 million. This is because it requires minimal operational infrastructure, but it's challenging to build an asset that doesn't rely on the founder.
2. If you want to build an asset that can be sold for $10-100 million, a traditional business is a better model. However, it takes longer to make money and requires more capital investment.
3. Key man risk is a major issue in the education and digital product business, where the founder's presence is critical to the business's success. This makes it difficult to scale and attract buyers.
4. The second problem is the difficulty in creating a recurring revenue stream. In a traditional business, sales often decrease over time, making it hard to sustain growth.
5. Focusing on a single goal is crucial: If you want to make a million dollars a year, a digital product or education business might be a faster and easier path. However, if you want to build an asset worth $10-100 million, a traditional business is a better option.
6. It's essential to eliminate alternatives: Commitment to a chosen path requires eliminating other options and focusing on a single goal.
7. The education and digital product business is faster to scale initially, but growth tends to slow down as the business becomes more expensive to scale.
8. The traditional business model is slower to scale initially, but growth can be sustained with the right systems and processes in place.
9. Conversion from a traditional business to a digital product or education business is challenging, and it's essential to cut ties with the traditional business and focus on the new model.
10. Ultimately, the choice depends on your goals and what you want to achieve: If you want to make a quick buck, a digital product or education business might be a better fit. However, if you want to build an asset worth millions, a traditional business is a better option.

Source: I Discovered The Easiest Million Dollar Business To Start In 2024, Alex Hormozi