Dear Startup: Your Goal is to Make a Profit, and Here’s How

You are in business to fill a need and in exchange for doing that well, your goal is to make a profit.

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The key is to be smart about your marketing efforts in order to lower your cost per acquisition, while also delivering the proper up-sells and cross-sells to make a quicker return on your investment.

If you’re profitable from day one, that’s a huge sign that you’re doing things right.

On larger launches, your goal should be to have a profit margin of at least 15-30%, depending on the scalability of the campaign. The goal of any business should be to break even as quickly as possible, and you can do this more quickly by keeping your venture as lean as possible.

Not turning a profit? Here’s why.

On the flip side, there are always a few key signs that indicate that a venture will not make money. These reasons include but aren’t limited to the fact that:

1. Your market isn’t big enough.

2. Your target market may not want your product or service.

3. Your cost per acquisition may be more than what you need to be profitable.

4. You’ve possibly lost your passion in a particular venture.

5. Your new company isn’t turning a profit quickly enough to cover expenditures.

In the beginning, you’re probably going to burn through some marketing dollars to find the right channels to make your business work. The beauty is, once you find the right ones that work, the hard work is done.

Remember, if it doesn’t work, move on, and if it does, then you may have yourself a nice cash cow.

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Photo Credit: Scotch & Soda

Peter Nguyen is the Founder and CEO of Advertiser 360, a comprehensive course created to help people build their own product or service online. Peter has launched nine highly successful Internet startups over the past decade as a serial entrepreneur and is one of the most highly-sought Internet marketing consultants in the direct response and affiliate marketing space.


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