“If there are nine rabbits in the ground and you want to catch one, just focus on one.” – Jack Ma, founder of Alibaba.com
Do you have too many business ideas? It’s not easy to decide what business to start. Here’s a quick guide on how to pick the best one for you – time is of the essence.
Ideas come easy to the entrepreneurial minded. It’s not hard to come up with a lot of potentially great business ideas – the hard part is picking just one to focus on.
It is even harder to narrow it down if you have been holding on to a few ideas for a while. The longer you wait before taking action, the more attached you become to an idea – even though it is worth nothing without execution. You start feeling like it is your own private invention, and think it to be worth something.
You don’t have to throw all your ideas out (coming up with new ones is a great mental exercise), but defeating analysis paralysis is important. Picking just one idea requires willpower and honesty (with yourself).
You have to pick the idea that’s most right for you.
Try this exercise. For each of your potential ideas, answer the following questions:
- Is this something people actually need? Is there a burning desire in the market?
- Is it lucrative? How big is the market and how many potential customers are there?
- Is it for you? Is it something you would be satisfied doing for the next 5 years?
- How easy would it be to test it out with a quick Version 1.0 and get feedback?
For each of these questions, give a score out of 5.
It doesn’t have to be a precise score (this is not an exact process), but you have to decide on a score. Then you add the individual scores to get the total (out of 20).
You will find that by answering the questions one by one, you start thinking more objectively about the business idea.
I’ve completed the exercise for a few ideas I’ve had recently:
|Idea||Is it needed?||Is it lucrative?||Is it for me?||Easy to test it?||Total Score|
|Guide for RTW Travellers||1||1||5||5||12|
|Display Ad Generator||3||3||3||2||11|
|English Tutor Listings||3||2||3||2||10|
|Internet Literacy Academy||3||2||5||4||14|
|Pushup Tracking App||1||1||3||3||8|
In short, none of my ideas were that good. Of the five above, I concluded that none even stand out. They just happened to sound cool when I first came up with them – prior to doing any research. Unless the idea gets 16 points or more, I disregard it.
Some points to consider:
- When assessing whether something is truly “needed” ask yourself: was this a real human need 10 years ago? And will it remain a need 10 years later?
- There’s no way to tell exactly how lucrative it will be (this all depends on your execution), but you can guess this by the growth rate of the market you are targeting and the total size of the pot of gold to be split up among the players
- If you can’t imagine keeping a daily blog about the business, chances are it’s not really personally satisfying – perhaps you are only in love with the idea of it
- Anything that requires a lot of initial development (e.g. coding) to test out should not have a high “ease” score
So try it out! If you have dozens of ideas, this will help you narrow it down.
And once you see a clear winner, go for it. Do something.
Get the first version (prototype) out, and see if anyone bites!