Make Your Business Idea Prove It’s Worthy…
I’m always talking with prospective entrepreneurs about their business concepts and ideas and where to start. One consistent thing that I find in those conversations is an individual who is wildly enthusiastic and optimistic about their idea.
In many instances that enthusiasm and optimism lead them to decide to launch the website, invest in materials, establish their legal structure and sometimes even lease a space.
I can relate because I started my first business with that same thought: “My idea is what everybody wants and will buy, so let’s go!” What inevitably happens next, though, is this: the idea is not as good as the entrepreneur thinks it is, the entrepreneur loses money, and the idea crashes and burns.
55% of Startups Failed
A recent survey conducted by CB Insights, a venture capital database firm, cited that up to 55% of the start-ups it surveyed failed because either there was no market need for the product/service or the product/service was mistimed.
In light of this statistic, my own experience in business, and witnessing countless entrepreneurs’ ideas not succeed, I suggest this: Don’t fall in love with the idea – make the idea prove itself worthy of your love.
Look at it this way: You go to the club, grocery store, church (whatever your choice of venue) and you meet him/her. You don’t fall in love, give up your apartment, and purchase the rings and wedding attire the next day, right? You give yourself time to get to know the person; have some phone conversations (old-school), or text/FaceTime/Facebook with them (new-school); you date them (dinner at Olive Garden for some, Ruth’s Chris for others); you introduce them to your friends and family to get a little feedback; and you do other activities that give you a chance to get to know if this is the right person for you.
View Your Business The Way You Would a Relationship
With that said, I suggest you look at your business idea the same way. When the next great idea approaches you, get to know something about it before spending your money on it. Ask the idea a few questions, such as:
- What need do you (the idea) meet, and what problem do you solve for people?
- Are you (your idea) different than other ideas that meet the same need?
- Do your potential customers have this need?
- How will your idea make money, if at all?
After the idea answers these questions for you, do some research. Investigate whether what the idea says is true. Look at industry data, market information, competition, trends, etc. If the research suggests the idea really has potential, develop a plan for how you will market the idea and conduct operations to provide the idea to customers. Determine how much money it will take to execute the plan.
If you conclude that you can execute the marketing and operations tasks and secure the money you’ll need to do so, you’ll know whether you are in a position to proceed with licensing, legal structure, and location. Once this process is complete, you’ll have enough information to determine if the idea is worthy of your love.
So the next time you think you’ve come up with what you believe to be the next Microsoft, think about whether your idea is love-worthy. Or maybe just reflect back on all those times you thought you’d met Mr. or Ms. Right – but then you realized, you were wrong.