Jan 25, 2024 · 54m · startup-ideas
How To Find MILLION DOLLAR Business Ideas That WORK | Noah Kagan
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In this in-depth interview, entrepreneur Noah Kagan joins Greg Isenberg to unpack practical frameworks for discovering, validating, and scaling million-dollar business ideas. Kagan shares hard-won lessons from building AppSumo, emphasizing rapid customer validation, lean software opportunities, bootstrapped growth, and radical transparency over vanity metrics.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Greg holds 36.3% of the talking time here. How this is scored →
Greg as informed peer 4.8 Guest teaching 3.3 Guest disagreement 1.3 Greg pushing back 0.6
speaking balance: gold is Greg, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 40:34 Noah rejects burn-the-boats mythology
Noah forcefully dismisses the common startup advice of extreme sacrifice and burning the boats, arguing it glorifies unnecessary suffering.
Hardest push from Greg ▶ 31:10 Noah challenges audience-first buildingNoah challenges Greg's model of building an audience first, arguing that audience members rarely convert into paying customers unless validated directly upfront.
Biggest teaching moment ▶ 19:55 Noah's masterclass on fractional leadershipNoah educates Greg and the audience on pairing rising operational talent with high-level fractional advisors from companies like Duolingo and Zapier.
Greg holds their own ▶ 28:48 Greg reveals Wall Street Survivor storyGreg demonstrates his seasoned business pedigree by sharing how he took Wall Street Survivor public in Canada and then privatized it to protect the asset.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Greg as informed peer | Guest teaching | Guest disagreement | Greg pushing back | Why |
|---|---|---|---|---|---|---|
| Designing a Differentiated Book Cover for Million Dollar Weekend | 3 | 3 | 1 | 0 | Greg opens warmly by praising Noah's bright green book cover, prompting Noah to explain his contrarian strategy against publisher pushback. The exchange is upbeat and collaborative with low tension. | |
| Customer-First SaaS Philosophy and Niche Software Opportunities | 5 | 4 | 2 | 1 | Greg asks about SaaS opportunities and connects Noah's examples to his own direct experience having lunch with CastMagic's founder. Noah emphasizes problem-first customer validation rather than technology-driven building. | |
| AI Disruption, Boring Jobs, and Unsolved Hiring Bottlenecks | 6 | 3 | 1 | 1 | Greg cites a Wall Street Journal article on accounting shortages and names niche hiring platforms like Go Squared Away and Support Shepherd. Both founders trade practical insights into the massive unsolved problems around hiring. | |
| The Power of Analog Methods, Focus, and Single-Point Innovation | 4 | 3 | 2 | 1 | Noah pokes gentle fun at Greg running six companies simultaneously when discussing the virtue of focus. Greg humorously acknowledges the contradiction while explaining his one-at-a-time milestone approach. | |
| Managing Greg's Agency Portfolio and the Real Definition of Bootstrapping | 7 | 2 | 1 | 1 | Greg breaks down the exact revenue and operations behind his portfolio companies like Boring Marketing. Noah reads out the historical origin of the term bootstrapping from his phone. | |
| Scaling Companies with Fractional Advisors and Customer-Led Capital | 5 | 5 | 1 | 0 | Noah outlines his exact playbook for hiring top-tier fractional executives from companies like Duolingo, Zapier, and Mailchimp. Greg validates the model and adds his own view on taking advice from operators over investors. | |
| Noah's $1 Million Blunder: The AppSumo Catalog Expansion | 3 | 5 | 1 | 0 | Noah recounts his costly mistake of rapidly scaling the AppSumo catalog from 600 to 13,000 products based on Twitter hype rather than customer validation. Greg listens attentively as Noah breaks down the financial and operational fallout. | |
| Website Pitfalls and Greg's History with Wall Street Survivor | 7 | 2 | 1 | 1 | Greg reveals for the first time how he built, took public, and privatized Wall Street Survivor after the 2008 crash. Noah is visibly impressed by the scale and asks specific questions about the outcome. | |
| The Audience-Community-Product Funnel and Radical Business Transparency | 6 | 3 | 2 | 1 | Noah challenges Greg's strategy of building an audience before having a validated product. Greg defends his Audience-Community-Product (ACP) funnel by detailing how he converts social followers into feedback communities. | |
| Normalizing Rejection and Finding Fast Product-Market Fit | 5 | 4 | 3 | 1 | Noah rejects the cultural glorification of burn-the-boats founder stress, arguing that real product-market fit reveals itself quickly. Greg agrees while sharing the backstory of Nikita Bier's near-misses with TBH and Gas. | |
| Early Career Struggles and the Reality of Long-Term Compounding | 5 | 4 | 1 | 0 | Noah shares AppSumo's revenue trajectory over a decade and emphasizes that building lasting wealth typically takes 20 years of compounding. Greg reflects on his humble beginnings breaking boxes in retail. | |
| Evaluating Daily Life Inefficiencies for Million Dollar Ideas | 4 | 3 | 1 | 1 | Noah discusses finding startup ideas by spotting daily inconveniences in Austin, such as healthy meal delivery and property management. Greg brings up historical parallels like Sprig to evaluate feasibility. | |
| Book Launch Logistics, Frugal Habits, and Life Milestones | 3 | 2 | 0 | 0 | The interview wraps up with lighthearted banter about media mail rates, points hacking for international flights, and Noah announcing he has a baby on the way. The tone is celebratory and personal. |
Statements from this episode (29)
Kagan: Publishers avoid green business book covers due to industry superstition
“What was really interesting, if you go look on Amazon or a bookstore, there's no green business books. Which is kind of funny given that a lot of business is about money. They think it's taboo or bad luck, but we tested it and I also like the color myself.”
Kagan: Castmagic reached $1M ARR in less than a year
“There's a tool on AppSumo called CastMagic. I think in less than a year, they had a million ARR.”
Kagan predicts Google Analytics will be disrupted and lose significant market share
“So one of the easy ones I think is going to easily get its ass kicked is Google Analytics.”
Kagan pre-sold $3,000 of a DocuSign alternative in 48 hours
“And so in 48 hours, I was able to sell 3000 dollars worth without using any social media or any of my email list. And in pre-sales to a DocuSign alternative for life, which will launch in 30 days on AppSumo.”
Kagan bets his new DocuSign alternative will make $1M within a year
“And then I believe, I would bet, I'll bet a million dollars, it'll make a million dollars in a year.”
AppSumo's TidyCal generates $3,000 per day in profit on lifetime pricing
“So we launched tidycal.com maybe two years ago, and that's doing 3000 dollars in profit a day at 29 dollars for life.”
Kagan: Significant market opportunity remains for Zapier competitors and integration platforms
“I think there's still a lot of room around, like how do all these separate software products talk together?”
Isenberg: Founders should avoid relying on creators to drive startup growth
“I think there's something to be said about being constrained and building your own media. Building your own, you know, your own community and not being just like how you don't want to be dependent on VCs. You don't necessarily want to be dependent on creators.”
Isenberg predicts the most uncool jobs will be replicated by AI first
“The most uncool jobs are going to be the first ones to get replicated by AI.”
Kagan: AppSumo uses Howdy.com to hire vetted South American developers
“We use howdy.com. Have you seen them? So they give you, they hire South American developers and employees, but they do all the vetting and they just make it stupid easy for you to have full-time dedicated staff in an area. So we're on our absolute originals pr…”
Kagan: MaryMakery generated $50,000 in its first year selling greeting cards
“I just talked to someone who read million dollar weekend. Her name's Mackenzie. I got to give her a shout out. Mary makery.com. You know, if everyone's going one direction, so she's a greeting card business, 50,000 dollars her first year.”
Kagan: Founders only need to innovate ten percent of a new project
“Andrew Chen said so many years ago, he's like, you don't have to innovate a lot. You just have to do one thing. Cause I think we have to, we imagine like, well, I've got to innovate the book and then the marketing. It's like most of that stuff has been solved.…”
Isenberg projects Boring Marketing will generate $2M to $3M FCF in 2024
“And that, that business is going to throw off two to three million dollars of free cash flow this year, which is crazy.”
Isenberg: Hiring your friends is a great business strategy built on trust
“I know people say, like, don't hire friends and stuff like that. Well, it's like, you trust your friends. Like, there's a reason why you're friends with your friends. And so, I say hire friends. I say hiring your friends is a great idea.”
Kagan: Pair elite fractional advisors with hungry junior internal employees
“We go and look at who did the thing at this company that's ahead of us. And then we pay that person a lot of money per hour. And then we hire a more junior person who cares probably a little bit more about AppSumo. And then they, it's kind of a nice, nice merg…”
Kagan reveals AppSumo's roster of fractional advisors from top tech companies
“Almost everyone in leadership gets a person. So Anna who runs people, we have Christine, who's the chief people officer from Duolingo. Moody Glasgow was the CMO of Zapier and Glassdoor. He does marketing. There's a guy named Colin Gardner. He does revenue. So …”
Kagan: The best compensation method is asking hires what they want to make
“I think the best way to pay people is ask them how much they want to make.”
Scaling AppSumo to 13,000 products dropped gross margins from 50% to 30%
“And so we went from 600 to 13,000 products within six months on the site and our revenue stayed the same, but our profit went down, right? Because now we have different margins. So some products have Better margins than others. So we went from normally like a …”
Kagan spent $1M in cash promoting AppSumo's expanded product catalog
“And then I decided to also spend a million dollars cash to promote that we have all these new products on AppSumo.”
Isenberg: Over 80% of top US business schools used Wall Street Survivor
“80 plus percent of the top US business schools would pay us to power their finance curriculum.”
Wall Street Survivor spent $2M to go public and $2M to privatize
“We spent two million dollars to make it go public. Then we spent two million dollars to privatize it.”
Isenberg details his ACP framework to validate products through niche communities
“So I have this funnel that I talk about, which is like, it's called the ACP funnel audience community product. So, I usually start with an audience. Twitter, Instagram, TikTok. Build up, like, it also allows you to be clearer about What it is, like how to posi…”
Only six of Kagan's 1,300 book launch team members made a referral
“Like, we tried for the book, I did a referral program. Like, hey, if you, I had a launch team for the book. And I was like, all right, bring one person. So there's a 1300 person launch team. And I said, if you could bring one person, I'm going to do a dedicate…”
Isenberg: Boring Marketing reached $1M in revenue in under a year
“How long did it take for born marketer to make a million? ... Just under a year.”
Kagan: All my successful ventures gained initial traction within a weekend
“And I've noticed with all of my successes, they have started fast. Like that's what I, you know, weekend, if not sooner.”
Kagan reveals AppSumo reached $80M in annual revenue as a bootstrapped business
“Once they start working, you know, for AppSumo, it was like, we did some of you, it worked right away. It was like first year, 300,002nd year, three million, but then it was flat, you know, for a few years. Like 4,000,004 1,000,005 1,000,004. Then it started p…”
Kagan observes it takes an average of 20 years to become a billionaire
“These billionaires, they all took 20 years. I was looking at all of the ones I've interviewed and the ones I've worked for. It's about 20 years you ever take on average for them to make a bill.”
Kagan's early Facebook hockey app hit 1M users in a week
“So I copied the most popular app in, in one category that had the least competition, which was a soccer app. And I made a hockey app and I chased it and it went viral a million users in a week. And then I launched a bunch and then Naval wanted to fund me and o…”
Andrew Chen modeled the economics behind AppSumo's shift to individual deals
“AppSumo used to be bundled software deals. And then we went to individual daily deals and it's not just cause that's what Groupon did. It's cause we literally like had to go understand that we looked at the economics of bundles. Andrew Chen put it together. He…”