Everyone with an entrepreneurial spirit wants to have a breakthrough idea, one that has the potential to change an industry or even the world. However, it can be hard to know if anyone else thinks that your ideas are actually good.
No one wants to be the person that pitches a bad idea to a potential investor or business partner. To avoid that embarrassment, and a lot of work, time and effort thrown into a bad idea, here are some techniques to help you determine if your idea is worth pursuing.
1. You’re constantly thinking about it, morning to night.
If it’s on your mind during your daily commute, when you’re in the shower, when you go to bed and when you wake up, it could be worth it. If the thought doesn’t fade away after several months or even a year after you first thought of it, then the chances that it may have some merit are even higher.
Thinking about an idea constantly suggests that it is also something that you are passionate about. A great idea is a small fraction of what makes a business successful. The drive and capability to take that idea all the way from concept to reality is more important. Building a business is incredibly difficult and many entrepreneurs burn out fast. If they aren’t passionate enough about an idea, they’ll give up.
2. It solves a real problem and fulfills a need.
Most startup success stories started as a result of a founder’s own personal or professional experience. They noticed a problem and had a creative solution. For example, the cloud-based file sharing service Dropbox was founded by two developers, Drew Houston and Arash Ferdowsi. Houston had the idea for Dropbox when he forgot his USB storage device on a trip.
The problem was one that we all could relate to, relying on hardware and physical devices to save work and risking loss. Since he had the computer and developing experience, he set out to build a way for people to save their files online.
3. There’s nothing else like it on the market.
This may seem obvious, but trying to enter a crowded market is tough. Your chances of succeeding in that market are even slimmer if there is one or several big players already doing what you want to do, and likely, doing it better than you ever could.
This doesn’t necessarily mean that you can’t pursue something that already exists. But, you have to vastly improve upon what your predecessors are doing. You also need to provide a large enough incentive for people to choose your product or service over the pre-existing ones.
4. People will buy it.
If something has value, people are willing to pay for it. How do you know if people will buy it? Ask them. Pitch your idea, product or service to as many people as you can. First, start with people that are already a part of your network and that you trust. Ask them for honest feedback, because their responses will influence whether or not you pitch to people outside of your network, like investors who are generally less forgiving. You may even get your first customers this way.
5. You’ve tested it.
Feedback is crucial to testing the solidity of an idea. However, testing your product or service before going to a full-blown launch can provide you with hard data to help you evaluate its value. Create a prototype or minimum viable product and distribute it to a test group. Unlike when asking for initial feedback, it’s best that this group does not consist of friends or relatives. Instead, it should be people that fit your target audience and who won’t be afraid to tell you exactly what they think.
6. Is it easy to explain and understand.
If you can’t explain it clearly within a minute to 30 seconds, you have a major problem. People have short attention spans, and investors and other key players in the business world have heard thousands of ideas. When you can’t explain something so that anyone can understand it and see its benefits, it will confuse them, make them doubt you and likely cause them to disengage.
7. You can make it happen.
Do you have the skills and expertise needed to build this idea from the ground up? This is especially crucial in the early stages, when you may be responsible for all the arms of your business, from product development to sales and marketing. Founders are often specialists, not generalists. They know the industry, have the skills, and aren’t afraid to build their business with their own hands if it’s what is needed.
If you don’t have those skills, that doesn’t necessarily mean that you shouldn’t pursue a good idea. But you’ll want a co-founder, founding team or other key support that can fill those skill gaps.
Even the most revered entrepreneurs have bad ideas. For all the thousands of ideas that pop into your head, there could be a gem in there. If you think you’ve stumbled onto a good one, but don’t know how to get started or have the bandwidth to grow as fast as you’d like, contact us for some help.