How to Choose a $1B Idea

In early 2025, I sold my company to HEX.
Together, the two companies are stronger than ever.

But let’s be real—
It wasn’t the billion-dollar unicorn I pitched.
Not even close.

Opportunity selection.
Probably the most underrated skill in startups.

For four years, I poured everything into EntryLevel.
Blood, sweat, money.
I had everything startup Twitter says you need: A+ investors, killer team, and enough skills to make it work.

I did the work. I sweated the 99%.
And yet… nothing close to a billion

I even listened to the advice: “Just focus.” So I did. For two years, it was EntryLevel or nothing. The next two? Only side bets under 2 hours a week. No distractions.

So, where the hell is my outcome?

They say it’s 1% inspiration, 99% perspiration.
Over the past year, I’ve come to believe the opposite.
It’s 99% inspiration, 1% execution.

Mediocre ideas are like rowing a boat with a hole in it. You’re paddling hard just to stay afloat.

While I was juggling payroll, Jesse made $150k in a week by emailing hedge funds some Google Docs. Dong Nguyen made $50k/day from a pixelated bird dodging pipes. (Flappy Bird)

If some people are making $150K in a week or $50K a day from apps,
Why are we breaking our backs trying to make average ideas work?

So here’s what I’m going to do:

First, I’ll break down why EntryLevel—while meaningful—was a bad business model.
Then, I’ll show you how I’d invert those lessons to pick a $1B idea next time.

Let’s get one thing straight:
EntryLevel wasn’t a failure.
It helped hundreds of thousands of people learn skills they couldn’t otherwise afford.
It even had tens of thousands of paying customers.

But… it still wasn’t a good business.
Not if you’re aiming for scale.
Not if you’re trying to build a unicorn.

I don’t regret it.
But the goal of this piece is to help you—
skip the million-dollar mistakes on the way to the billion-dollar ones.

Low Lifetime Value

We launched with an insane deal: $5 for a 6-week bootcamp.
Great for users. Brutal for business.

At that price, Stripe took 9.5% in payment fees.
At $100, the same fee is just 3.8%.
Tiny margins meant we were bleeding before we could even scale.

Even after raising prices to $30, we’d need 3.3 million customers a year to hit $100M.
That’s Udemy volume. Without Udemy capital.

And low LTV doesn’t just limit your revenue. It handcuffs your growth.

We couldn’t spend much to acquire customers—because we’d never make it back.
Meanwhile, Udemy could outbid us on ads, invest more in their product, and still profit.

Every dollar they made unlocked more firepower:
📈 More ad spend
🧪 Better R&D
🎯 Better user experience

We didn’t just have a revenue ceiling. We had a compounding disadvantage.

This is why companies like Maven and Reforge focus on higher price points.
Fewer customers. Higher margins. More room to deliver value.

We were stuck in no man’s land.
Too cheap to be premium.
Too pricey to outcompete the free stuff.

Low Differentiation, Commoditised Product

Let’s be honest—most online courses look the same.
We could argue all day why EntryLevel was better.
But in a commoditised market, no one’s listening.

It’s like selling ketchup.
You might say yours has better ingredients, more tang, better gut health.
Most people still grab the brand they’ve seen before.

In low-differentiation markets, brand becomes everything.

Not features. Not pricing.
Just: “Have I heard of you?”

That’s why we doubled down on Africa.
We built real brand equity.
In some countries, we were the go-to.

At one point, we were growing 3x month-on-month.
But once we tried scaling beyond those borders, we hit a wall.

Crowded markets.
No mental shelf space.
And our LTV was too low to outspend the incumbents.

Here’s a law of marketing I live by:

People can only name two brands per category.
Everything else is background noise.
_{(Source: 22 Immutable Laws of Marketing)}

In most target countries, Udemy was Brand 1.
Coursera was Brand 2.
We were the noise.

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Low Barrier to Entry

One morning in 2022, we found a site in India that had cloned EntryLevel.
Same courses. Same messaging. Pixel for pixel.

A week later, there were more.
We weren’t big enough to sue anyone. So we reached out—thought maybe they could become partners or acquisition targets.

Most didn’t even reply. Probably thought we were calling to threaten them.
We weren’t. We were just… surprised.

But the lesson hit hard: our moat was paper-thin. If I could spin up EntryLevel in a few weeks…

So could anyone else.

Everyone’s building LMSs now. Cohort tools. AI instructors.
The code barrier is disappearing. The playbook is public.

And if differentiation is low and the barriers are low?
You end up in a race to the bottom.

More clones = more ad competition = higher CAC. Prices drop. Margins vanish.
Eventually, only the biggest platforms survive.

We carved out an edge by focusing on Africa. That gave us short-term success—many couldn’t even accept payments there. But the low LTV meant we still couldn’t scale sustainably.

We built a good thing. Just not a defensible one.

Ajay’s Framework for $1B Ideas

If EntryLevel taught me one thing, it’s this: You can work hard on the wrong thing.

So here’s my framework — built by inverting every painful lesson I learned. If you’re gunning for a billion-dollar business, start here.

High Differentiation

You want to be weird. Weird is good.

The more different you are, the less you rely on branding, ads, or hype. You stand out by default.

Think driverless cars — nobody asks Waymo to explain how they’re different. The tech is the differentiator. If you can solve a hard problem in a unique way, customers show up.

You don’t have to go full NASA. Just solve a real problem differently enough.

Example: I’m looking at insurance for collectibles in Australia. Think Pokémon cards, sneakers, signed jerseys. The demand is there. The product isn’t. That’s differentiation.

Search traffic would be mine on Day 1.

High LTV

When customers pay more, you can:

• Build better stuff.

• Hire better people.

• Outbid your competitors.

That’s why B2B SaaS is elite. One client pays $50K, and you can drop $10K to land them. Try doing that with a $50 course.

Heard of Figma? They charge up to $900 per user.
Heard of Penpot? Probably not. It’s free.

More revenue = more leverage.

I’ve been playing with ideas like research tools for hedge funds. They move billions. If you can help them make slightly better decisions, they’ll throw six figures at you for a PDF.

High Barrier to Entry

If it’s easy to start, it’ll be hard to win.
If it’s hard to start, it might be easier to scale.

Most founders chase the easy stuff: dropshipping, agencies, courses.
Few pursue the hard stuff: regulated, capital-intensive, legally complex.

That’s where the moats are.

Example: Sunscreen in Australia.

To legally sell SPF, you need TGA approval. That can take 6–24 months and thousands in testing. Plus, there are ad restrictions. No influencer promos. No wild claims.

But once you’re in?

Low competition. High trust. Long tail.
Same with government contracts — break in once, and you’re in a club few can touch.

High Barriers = Fewer Players = More Room to Win.

Final Thought

Startups are glorified for hustle.
Execution. Grit. Grinding.
But here’s the uncomfortable truth:

If you’re playing the wrong game, it doesn’t matter how well you play.

In computer science, there’s a concept called the Multi-Armed Bandit. Imagine a row of slot machines, each with different but unknown payouts. The challenge? You have to figure out when to explore (try new machines) vs. exploit (stick with the one paying out).

Startups are no different. Every idea is a slot machine. And too many of us spend years pulling the same low-payout lever — hoping grit will make up for a bad bet.

Here’s what I learned the hard way:
Selection is the true leverage.
The right idea at the right time with the right edge? That’s how you move the needle.

Execution matters. But only after you’ve picked the right machine.

Until next time,

Ajay

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