How I Acted Unfairly To Build A $1M Side Business (And How You Can Too)
Building and growing a side business is hard! In order to succeed, you need to stack the odds in your favour. And the best way to do this is to act unfairly. But what does this really mean?
What does acting unfairly mean?
Let’s start with what it doesn’t mean. Acting unfairly in this context does NOT mean being unethical or doing anything shady. Quite the opposite. Acting unfairly means identifying where you can add the most value with the least effort.
In order for your side business to be sustainable from a time and resource perspective, eliminating friction is key. Friction is anything that is a barrier to building or growing your business. For example, if taking a 6-month course in programming is a pre-requisite to getting started with your business, that is friction. If you need to build relationships in a new industry with no existing links, that is friction. There will always be friction in building and growing your business, but in order to move fast and provide the most value with the least effort, finding ways to reducing friction is essential.
How do I act unfairly?
Step 1: Identify your unfair advantage.
Step 2: Use your unfair advantage to rank your side business ideas.
Step 3: Execute your top ranking ideas.
This post will only cover Step 1. If you interested in Step 2 and Step 3, make sure to subscribe to this newsletter so you can receive new posts directly in your inbox.
At first, you might think you have no unfair advantage. This is because we tend to be self-critical and therefore we are much better at identifying our weaknesses than our strengths. But the truth is we all have an unfair advantage and hopefully by the end of this post, you can identify yours.
My first idea for a side business was to build an app that automatically diagnosed rashes on intimate body parts. While it seemed like a good idea at the time , I realised I knew nothing about rashes, wasn’t necessarily keen on going through pictures of intimate body parts and had no clue on how to navigate the necessary health regulations to get my product to market. There was far too much friction in getting started, so I never did. Apart from my programming skills, I had very few unfair advantages in executing this idea.
Today, I build technology to accelerate sustainable fashion production. I converged on this space after several years of trial and error with other ideas. In effort to minimise the trail and error phase in the future, I reverse engineered my journey in choosing fashion as the industry to focus on. This process led me to a simple conclusion: had I acted unfairly in the ideation phase, I would have pursued a business in the fashion industry much sooner and saved a lot of wasted effort.
My unfair advantage
Growing up, I spent a significant amount of time in my grandfather sock factory watching the circular knitting machines spit out one sock after another. I observed how fibre was turned into yarn and how yarn was turned into socks. I also witnessed the devastating amount water that went into the dying process. My grade 8 multimedia project was a short documentary on how socks are made in my grandfathers factory. Being in that environment, I developed a deep understanding of the various challenges manufacturers faced when running their business.
My familial background in fashion and manufacturing was an unfair advantage I had completely overlooked. It wasn’t until I had spent years exploring different ideas that I came across fashion and manufacturing.
The fact that I was able to share my personal story and speak the industry language allowed me to build credibility and trust with my eventual clients and partners. Looking back, if I had a more systematic way or a framework of identifying my unfair advantage, it would have saved me a lot of wasted effort on ill-suited business ideas.
Finding your unfair advantage
So how can you identify you unfair advantage? In the book, The Unfair Advantage, co-authored by my friend Hasan Kubba, he introduces a framework called the M.I.L.E.S. framework. I have adapted the M.I.L.E.S. framework to make it more applicable for people building a side business. In my modified version, M.I.L.E.S. stands for Money, Insights, Location, Education, Status.
Money. When building a side business, it is essential to understand your financial advantage. Do you have a job where you can pick up extra shifts in order to make up for your initial start up costs? Or maybe you work remotely and can reduce your burn rate (minimum daily living cost) by moving to a cheaper location. Having a financial advantage means you can invest in contractors, premium tools, and online ads. This is an unfair advantage when it comes to building a side business.
Insight. Do you have unique knowledge or insight into a particular problem? Insight can come as a result of practical experience. For example, Tobias Lütke, the founder and CEO of Shopify, upon first moving to Ottawa, started an online snowboard store. Because of this experience, he intimately understood the technical and logistical challenges of selling products online. In fact, Shopify emerged from his frustration with how difficult and expensive it was to sell goods online. This put him in an ideal position to build and grow Shopify, a platform that helps merchants sell online. What experiences do you have that provide insight into unique challenges? What industries have you worked in?
Location. Do you have a unique access to ideas, talent and capital due to your location? Jeff Bezos chose Seattle for Amazon’s headquarters for its abundance of technical talent due to Microsoft’s presence. José Neves, the founder and CEO of Farfetch grew up in Porto, Portugal where he was surrounded by shoe manufacturers. He was able to combine his technical expertise in programming with his understanding of the challenges faced by manufacturers to build software for the industry. Both Jeff and José used their location as an unfair advantage to drive the flow of ideas and talent. What are the advantages of the location you are currently living in?
Education. My educational background, a PhD in Computer Science from Cambridge University, meant I had an unfair advantage not only from a technical perspective, but also from a network perspective. Surrounded by students and academics in the AI space, I have access to free expertise but also potential future talent for my company. Do you have access to a network of experts or talent? Perhaps you have a specific certification or degree that equates to credibility in the field.
Status. Do you have trust and credibility in certain circles? Status does not always have to mean how many social media followers you have, how connected you are or what university you attended. It can mean whether you have trust and credibility with a certain group of individuals.
Operating in the fashion space, my familial background in apparel manufacturing enabled me to immediately build trust and credibility with my customers. This helped remove some of the friction in building relationships and doing business development. Ultimately, status is something that can be curated, but it’s always easier to build on something instead of nothing. What are the spaces or interest groups where you have trust and credibility?
“Unfair advantages are not static. They don’t exist eternally, they develop and change. You should always be asking what your unfair advantages are, both for yourself and your startup.”
- The Unfair Advantage: How Startup Success Starts With You
The topic of acting unfairly will continue to appear in Living For The Weekdays (LFTW) as we dive deeper into building part-time businesses. In the mean time, consider taking out a blank sheet of paper and filling out the MILES framework to find your unfair advantage. Feel free to share you unfair advantages in the comments where either myself or others in the LFTW community can give you feedback!
If you interested in using your unfair advantage to rank potential business ideas or other topics related to building a side business, then please subscribe to my newsletter Living For The Weekdays or show me some love on Twitter (https://twitter.com/_ahmedzaidi). Until then, keep LFTW!