You want to start a business. Great!!
Now how do you find a business idea that will be commercially successful?
You probably have too many business ideas but are not sure which ones will work or which idea to start with.
I will share my framework for picking a profitable business idea.
First thing to note is that not all ideas will help you create a good business. For example, I know how to write love letters very well but the market for that skill is not enough for me to start a business doing that. Secondly I personally do not enjoy it enough to start a business out of it. Finally there is such a thing as opportunity cost. For every idea you work on, you will lost the energy and time to work on others. This is why it is essential to do the following.
1. Make a list of your desires, gifts, talents and passions. When I was starting out I wrote down the stuff that EXCITED me. I also made a list of stuff I’m really good at. Stuff like branding, marketing, sales, copywriting, teaching, public speaking and design were on my list.
2. Make a list of needs or desires that you already have the capacity to fulfill.
This is absolutely important because your idea is what you can supply. This list is the proof that there is a demand for your idea, skill or expertise.
A quick way to find out if there is a demand for your idea is to use the Google Keyword Planner. Type in your idea and it will show you how many monthly searches there are for that keyword every month. I personally like an idea that has at least 3000 average monthly searches.
Here are some questions to help you find your first profitable idea.
1. What vision or instruction has God given me?
2. In what are do I have domain expertise or unique insight?
3. What problems do I want to solve?
4. What passion burns inside me so much that I have to make a business out of it?
Let’s start by explaining each one.
Some people will get a vision or instruction from God as to what they are supposed to do. Larry Page also attributes his idea for Google to a dream. Another example of this is someone is Moses from the book of Exodus.
2. Domain expertise and Unique insight
There are areas where you have a very deep or unique insight that others do not see. You can start a business with this idea. I particularly ask every entrepreneur who either comes for advice or funding this question since domain expertise couple with unique insight is a good sign that the business is starting off well. There are many businesses which will fail by the end of writing this post because the founders just saw an opportunity and started a business without getting any deep insight or domain expertise.
A common example is people who start restaurants just because a family member said they were a good cook. They start only to realize good food doesn’t automatically bring people. There is marketing, sales, pricing and many other things that should go along with the food.
The good news is that domain expertise can be achieved via getting internships, working as a freelancer, studying books or taking courses. Unique insight usually comes from working or being close to someone in that specific field. If you want to run an airline, it’s better to start with a cleaning job at the airport than to work as an investment banker. If you are a designer, then spend time around artists and other creative people. There are many unique insights hidden in plain view but only those who see it can access it.
3. Problem solving
You may have noticed a problem that you have solutions for. This is another good place to start. Find out who else is attempting to solve the problem and what they are either doing wrong or right. Make a list of your top 10 competitors and find out how they started, how many people work there, what their expenses are, how they make money and anything else that will make it easier for you to start this business.
Read every relevant book and blog post you can find. Ignorance of an industry is one of the major causes of business failure. Startups founded by entrepreneurs who think they know enough usually never last for more than a few years.
There may be an opportunity or business idea that is burning so much on your insides that it affects your sleep. Maybe every time you see homeless people or a particular news story, you feel like it’s your calling to do something about it. You may even feel anger or heightened emotion. This may be a sign that it is something you should at least start nurturing by researching solutions for.
The most important thing in all the ways to get business ideas is to study enough to get some domain expertise before starting. I personally will not invest in a founder who does not have some form of domain expertise since backing ignorance is very costly.
Write down answers to these questions
What do people want that I am equipped to provide?
What do I already know how to do that others do not?
What comes easily to me?
What unique insights and experiences have I gathered?
What is my calling?
What do I enjoy doing the most?
Before you decide to start a side business as a freelancer, consultant or small business owner, consider these questions. Even if you have already started making money on the side, these questions will help to lead you in the right direction.
You now know more about yourself and what you can provide. You also know if there is a demand for your ideas. Next, decide on which of these ideas you have time for. Can you write a blog post every week on your chosen topic? Can you spend at least 5 hours a week refining the idea and reaching out to clients?
If what you are doing does not excite you, it will be difficult to grow it into a successful business–especially when challenging times come.
Finally write down your top 3 ideas and grade them according to which one has the most commercial potential and is easy enough to start in the next 30 days if you set your mind and hands to it.
Let me know below in the comments, what ideas you came up with.