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Business ideas offer some of the greatest opportunities to make our society a better place.
History provides us with great examples of ideas that led to inventions in different industries such as the Wright brothers’ who built the world’s first successful airplane, Steve Jobs with Apple, Sergey Brin and Larry Page with Google, Mark Zuckerberg with Facebook, the list goes on…
I have had the opportunity to discuss some great business ideas with a lot of people and, from my discussions, I know most people have business ideas they desperately want to be the next big thing.
However, as with everything we hold so dear, sometimes the fact that we are so passionate about it makes us lose all sense of reality and refuse to accept the truth even when it stares us in the face.
I’ve compiled five really important things that will jolt you into being realistic about your business idea. These five (5) really important things make a lot of difference, I dare say, between success and failure.
1) IDEAS ARE A DIME A DOZEN .i.e. everyone has them
Have you ever thought you had just discovered a fantastic business idea only to tell someone (either a friend or colleague) and find out they also have the exact same idea? Or you do a search on the internet and find the exact idea already being implemented by someone, somehow and somewhere.
Well, that’s the thing about ideas. They are common. Everybody has them in one shade or the other. The ideas of value are the ideas you execute.
Best thing to do when you have 'a Eureka! moment' is to do some research to find out if someone, somewhere, on the other side of the planet or street has ,perhaps, implemented your original business idea or a version of your business idea. This will help you decide either to try out another idea entirely or fine tune your current idea.
Before Facebook, there was
Friendster, considered one of the original and even the "grandfather" of social networks. Today, Friendster technically doesn't exist anymore.
In reality, most successful business ideas are new ways to combine or re-imagine old business ideas.
2) TIMING IS VERY IMPORTANT
A research carried out across more than 200 start-up companies by Bill Gross, CEO Idealab (an incubator of new inventions, ideas and businesses) showed that the number one (1) factor that determined the success of a business idea is timing.
Timing accounted for 42% of the difference between success and failure. This doesn’t mean the uniqueness of the idea is not important. It is, but that factor came up third in the research.
A lot of people have probably never heard of www.Z.com. That’s because they attempted to launch a video sharing site in the nineties but went out of business in 2003. Two years later in 2005,
YouTube was launched and became an instant success.
Why? Because broadband penetration had just crossed 50% in the USA and more people were sharing and watching videos online. In the period, 1999 -2003, broadband penetration was too low which made watching and sharing videos online difficult.
Just about a month ago,
Jason Njoku, famed co-founder of
Irokotv.com and
SPARK, an incubator company, pulled the plug on its investments in 4 startups in Nigeria.
In his own words, "We are in the valley of death. We were a little too early. Bus, Insured, Giddimint and Christians we consider to be dead or non-active. That’s the reality. The lack of funding and us unable to go past the $250,000 bench mark meant we had to let go."
That does bring up the interesting question on tech startups in Nigeria. Is Nigeria ready for some of the tech startup businesses we see today? I'll leave you to debate on that.
3) MONEY MATTERS
Great ideas are fascinating but great businesses need to be self-sustaining.
An idea is the first milestone in the process of starting a business. Identifying a business opportunity is the next milestone.
The difference between an idea and an opportunity is commercial. An idea becomes an opportunity when you can show it has the capability to earn sustainable revenue.
I’ve heard some really great business ideas but when push came to shove, the revenue generating capabilities of those ideas were just not sustainable.
There are multiple ways for a company to make money. Two key ways are transactional earnings i.e. you create value and get paid. Apple is a great example of this model. They charge customers for a product with real value. Or you let the business rely on third party earnings e.g. Facebook’s advertising revenue
The transactional model is the best model for any company. Always aim for that except you’re a Google or Facebook.
4) EXCEPTIONAL EXECUTION IS EXPECTED
Nobody is interested in mediocrity or patch-ups. Focus on creating the best version of your business idea. The ‘exceptional’ attracts the best brains and of course needed investments.
However, don’t get into the analysis-paralysis trap. Do it already.
Sometimes, a great way to get the ‘exceptional’ is to start, make mistakes, receive feedback, make necessary changes and keep evolving. The thing about mistakes are, people won’t remember the mistakes years from now. They’ll remember the value that you provided.
Also, while working on building your business idea, work on building up yourself. One of the great things about Mark Zuckerberg was how he successfully made the leap from being a startup CEO to being a corporate CEO. He didn’t do it without errors but he was always honest about his mistakes and embraced them.
Zuckerberg won the 2007 Crunchie Award for 'Best Startup CEO.' He was the Time Magazine 2010 Person of the Year and later won the 2012 Crunchie Award for CEO of the year.
5) Finally, DON'T WALK A LONELY ROAD
You can’t do it all by yourself. Build a really great team, person by person or find a co-founder. Investors are wary of individual founders these days. A great team will bring in the required skill mix, balance and support system every start up requires.
Don’t be afraid someone will steal your idea. Yes, it does happen but don't let it stop you from working with people. From my experience, I’d say, when building a team, don’t focus only on an individual’s skills, personality and character are very important attributes, if not more important.
Successful business owners also know where to seek answers when they don’t have them. You need a resourceful network. Your network is your net worth.
I hope these five (5) points help you think objectively about that business idea.
Here’s to you coming up with the next big thing!
Stay remarkable.
Tomie