How do businesses create themselves?

Businesses are established through a process that involves identifying the right business model, understanding the target customer, and addressing a specific problem that the customer faces. Alex Hormozi explains that a traditional business plan is often not necessary. Instead, the focus should be on what to sell and how to acquire customers. He outlines a practical approach:

1. Setting Up the Business: Easily set up the necessary legal structures online (like an LLC), obtain a bank account, and connect a payment processor.
2. Understanding the Business Model: Businesses can generally be categorized into four types:
   • Products: Selling physical items (e.g., mugs).
   • Services: Offering services that fulfill a customer's need.
   • Code: Developing software that automates tasks.
   • Content: Creating media or entertainment products.

The key to choosing the right model is to pick a customer segment and a significant problem to solve, which could be related to increasing their status or saving time. Different broad categories include health, wealth, and relationships.

The steps to start include:

• Establish the business legally and set up financial processes.
• Choose a problem to solve and decide how to engage customers, based on the type of business (products, services, code, content).

This approach simplifies the initiation process and focuses on solving meaningful problems for specific target customers 1.