15 top tips to help you pick the right business idea
A good startup isn’t just a good idea, it’s customer conversations, dogged determination and excellent execution.
Have ideas that excite you and turn them into small realities as quickly as you can. Ideas are on their own are worth nothing.
Don’t put too much emphasis on the idea. The idea matters, but the execution matters much more. What’s more, the execution of your original idea will likely change dozens of times as you build.
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1) Indulge your curiosity
Good ideas often come from the unique combination of two seemingly unrelated things. The more you engage with different walks of life – the more you will put yourself in a position to cleverly combine different sources of inspiration.
So go to that talk you’ve been thinking about signing up for, go check out that new pop up market you’re interested in, send a note to someone whose work you admire.
2) Educate yourself
Examine existing business models and resources available. You will only be able to understand what is possible for you to build once you get your head around different tactics and resources.
You don’t know what you don’t yet know. Devour as much information as you can about startups and the tools powering them and you’ll have much more of a sense of what is possible for you.
3) Meet real needs
Focus on making something people want. Great businesses either reduce pain or frustration in their customers’ lives and/or bring joy and make them better. Make sure you are meeting a need or desire that people really have and are willing to pay you for, rather than a need or desire that you wish they had!
4) Borrow other people’s ideas
Borrow as many different business models and commercial strategies as you can. However – don’t assume that you can clone an idea and it will work just as well for you. The magic is in the execution, not the idea.
And, just because the Tinder interface works for dating, doesn’t mean it is going to work for jobs, personal trainers, restaurants, etc. Just because Airbnb works for accommodation, doesn’t mean it is going to work for llamas, boats, motorbikes, cars, etc.
5) Choose ideas that are suited to you
There is a big difference between a great idea and a great idea that you are the right person to build. Make sure you are working on the latter. Building a business is a real challenge, don’t make it harder on yourself by building something you don’t have the skills to build.
6) Build ideas that generate revenue quickly
Get to first revenue as quickly as possible. It is tempting to delay the process of selling / commercialising your idea. Waiting too long can kill your startup off. There are lots of ideas where the monetisation strategy relies on scale/growth, a complicated invention, or lots of advertising dollars – delaying the moment when the business can generate revenue.
Unless you’re building an investor-backed rocket-ship where you can delay revenue in order to build, get to revenue asap.
7) Go tried-and-tested on the business model
To stand out in a competitive marketplace it is imperative that you innovate on your product, service and brand. However, when it comes to business models; go tried-and-tested. There are lots of established ways of making money that work. You don’t have to invent another – building the rest of your business is hard enough as it is!
8) Find the rising tides
“I skate to where the puck is going to be, not where it has been.” – Wayne Gretzky. Start your business in a sector with a rising tide. What areas of the economy are booming? Go with trends, not against them. For information on the latest trends, be sure to check out Springwise and Trend Watching.
The best way to have good ideas is to have lots of bad ones. James Altucher’s The Ultimate Guide for Becoming an Idea Machine is a must-read.
10) Remember ideas change as you build
You might start with a consulting business, which develops into an information business, which develops into an events business, which develops into a franchise business, which develops into a software business.
The central idea might still be the same at the end of this process i.e. the thing you are trying to change or improve in the world, but you will have gone through many different iterations in terms of how the idea is manifested as a product or service. This is normal and quite common. Pinterest started out as a mobile shopping app, Android started out as an operating system for cameras, and perhaps the mother of all pivots…Nokia started out as a wood pulp mill. Pivots are normal, so stay agile, flexible and open to possibility.
11) Explore your niches and networks
What walks of life do you have a strong understanding of? Where do you have unfair advantages? Who trusts you? Who do you have access to? These are all areas where it makes sense for you to start a business.
12) Explore what frustrates you
One good shorthand for generating and assessing good business ideas is: Frustration, Conviction, Time, Skills. What frustrates you about the world? Of these frustrations, which might you have enough conviction to actually do something about? Then filter for the ones where you have skills that mean you actually could build a valuable solution. And finally, assess those where the time that it would likely take to build the solution is feasible and realistic for you.
13) Make sure it matters to you
The more you care about something, the more likely you are to work your socks off to make it a success. Getting clear on what matters to you will greatly influence the decisions you make about your entrepreneurial journey.
14) Keep it simple
If you can’t explain it in a sentence, the chances are you’re not going to be able to build something that people will understand. If your business model requires many different parties undertaking many different behaviours (most of which you can’t control) in order for it to work, beware.
15) Avoid emotional attachment
This is a big one. Obsess about the problem that you’re solving but please, please, please don’t get emotionally attached to your plan for a solution. It’s important to remain agile and open to challenge as you build out your solution, if you get to fixated on your solution you might miss opportunities to make your business better.
Be confident in the problem you’re solving, but please be flexible and open to changing the solution if it doesn’t work.
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