How to start a business - Part 1 - What is a business?

I’m starting a multi-part series on how to start a business. In it I will explain my philosophy; and follow up with how it applies to TuitionCoin.

If we are starting a business, let’s start with a good definition of a business. A business is repeatable value. That’s it. If it is repeatable but not valuable – it either goes bankrupt or never starts. If it is valuable but not repeatable – it may burn bright, but will eventually fade or crash. Another definition; BIG businesses are scalable. If it is not scalable it may be a business, but it will never be big.

It is my theory that all business go through the following stages. Discovering value, delivering value, repeating delivery, optimizing, scaling, operating, and capitalizing. We will talk through the stages in future posts.

The founders job is to start a business from scratch. You succeed, when you have a business.  This means, you need to get through the first three stages. Discover value, deliver value, and find a way to repeat delivery. At the end of the three stages, based on my definition, you are a business!

How does this apply to TuitionCoin. I’m in phase two, but investors want me in phase 5 (scaling). I’m not there because of a strategic decision. I could have outsourced both origination and servicing to move faster. This is a big question for any founder. The question is; how much do you do, and how much do you have others do? The tradeoff is between learning and speed. In doing you will learn. In not doing you will be quick. I believe the most important thing for a start-up is learning your core business. If something is not your core, have someone else do it. In my situation. I believe the lender that owns the entire value chain and optimizes every step will win. It's a lot of work figuring out the entire value chain; but, here is the thing. I’m playing to win.

Go to Part 2 - Discovering Value

The Ultimate Question Every Entrepreneur Faces

The ultimate question every entrepreneur faces is this; When they try to change the world, who is going to break first, them or the world?

By definition an entrepreneur believes they can change the world. It's what they set out to do. Yet, to be successful an entrepreneur needs to face reality. This is a huge paradox. The world is almost impossible to change. Yet, the entrepreneur believes they can. And this paradox causes emotional turmoil. For me, I wonder if I am really capable of pulling this off. It's ridiculously complex, challenging, and full of problems. It's easy to wonder if I am deluded.

In fact, I think this is the question every human being faces. When we face the world, who breaks first? Do we stand up for what we believe; or do we break in the silent acceptance of those around us? If we have a passion, do we relish our hobby? Or let life get in the way. When tragedy strikes; can we find our joy again.

This is the hard truth. We all break. We all doubt our ability, our vision, our sanity. And for some it's not a violent snap; but a slow acceptance of a thing.

The beauty of life is this; Each day, even after we break, we have a new opportunity to stand up and to push, and when we do, a magical thing happens, it's what keeps the entrepreneur going. . . when we push, the world really does change.

Is a School Good or Bad?

TuitionCoin only refinances people from “good” schools. If anyone assumes we mean “ivy league,” we absolutely do not. The VAST majority of schools are “good”. Some of the best schools are public schools.

This is what the data says. Most schools, regardless of degree, lead to jobs making significantly more than high school graduates. By significantly, I mean the cost (including opportunity cost) of college pays for itself multiple times during a person’s career. The tremendous value of higher education is one of the contributors to tuition growth.

TuitionCoin rated over 4,000 schools and assigned grades from A+ to F. Ratings are primarily based on default and graduation rates. We use default rates because they are the best indicator of a schools success.