My First Million
The best business ideas come from noticing what's working and doing it better, faster, or for a different audience.
Value Equation Framework
A mathematical framework for maximizing offer value: (Dream Outcome × Perceived Likelihood of Achievement) ÷ (Time Delay + Effort & Sacrifice)
How It Works
Works by systematically optimizing four variables that customers unconsciously evaluate when making purchase decisions, allowing businesses to charge premium prices while increasing conversion rates
Components
Define the ultimate dream outcome your customer wants
Build perceived likelihood through credibility, guarantees, and risk reversal
Minimize time between purchase and result delivery
Reduce or eliminate effort and sacrifice required from customer
Create solutions for each obstacle in every category
Test and iterate based on customer feedback
When to Use
When designing any offer, especially when struggling with pricing, low conversion rates, or competing on price rather than value
When Not to Use
When selling true commodities with no differentiation potential, or when targeting extremely price-sensitive markets with no willingness to pay for value
Anti-Patterns to Avoid
Example
“Personal training ($2000, 18-month timeline, high effort) vs liposuction ($50000, immediate results, no effort) - same dream outcome but dramatically different value equation components”
Related Knowledge
Transform existing offers to command premium pricing while increasing conversion rates
Doubling or tripling offer prices while maintaining or increasing close rates, leading to step-function business growth
Close more sales at higher prices using strategic bonus delivery instead of discounting
Higher close rates without discounting, maintaining profit margins while increasing customer satisfaction
Value Equation Lens
Evaluate all business decisions through the lens of how they impact the four value equation variables: dream outcome, pe
Price is determined by value equation optimization, not cost-plus margins
Businesses should focus on value engineering rather than cost reduction for profit growth
dream outcome times perceive elective achievement below that you have time delay and then effort and
Mathematical formula for determining offer value based on four key customer perception variables
we can double the price or triple the price for offer and close at a higher percentage
Proper value equation optimization can dramatically increase both pricing and sales conversion rates