In the art of entrepreneurship, there is a fine line between a successful idea and a delusional one.
More often than not, entrepreneurs fail to distinguish this line and end up with an eventual failure.
The ability of an entrepreneur to determine the needs of a market, distinguish the path to profit and pivot quickly are all paramount to achieving success.
Here are a few critical factors to consider the next time you are trying to come up with a business idea that will garner success and help you earn continuous income.
While innovation may be the blueprint for many entrepreneurial success stories, not all innovative ideas are guaranteed to make money.
Awaken Your Entrepreneurial Genius
Awakening your entrepreneurial genius may appear to be an intense and daunting task, but the reality is you do not need to perform a ritual dance or send electrical signals to your brain in order to get your neurons firing. Everyone has great ideas.
The problem is that people also have bad ideas that often deter them from any further brainstorming. In order to capture all possibilities and effectively distinguish between the prospects and the dead ends, adopt the practice of writing down every idea that comes to your mind throughout the day.
Keep a notepad handy or use a smartphone app to record at least 20 business ideas a day for one week. After seven days, review each concept and establish a power ranking system to move the best ideas to the top of your list. From there, eliminate the unreasonable options and trim your list down until you are left with your top 10 ideas.
Once you have your top ten ideas finalized, share them with your family members, friends and anyone else who will listen, and ask them for their candid feedback. Use their feedback to fine-tune your ideas until you are able to narrow your choices down to one concept with true depth that has the ability to anchor the launch of a successful business.
Many people (including myself) prefer to keep their ideas secret from others in fear that they will be stolen, but this is often a big mistake. Sharing your ideas and requesting feedback can make the difference between a successful business and one that fails to gain acceptance by the market. Besides, it is highly unlikely that anyone will steal your idea, and if they do, the chances of them following through and actually starting the business is slim.
Dr. Barry Burns of Top Dog Trading was trained by three personal mentors who taught him how to navigate in the markets. He actually used their feedback to test and develop his approach to trading, which he is now teaching to his students. The worst mistake you can make in your entrepreneurial endeavor is implementing an idea before determining whether there is even a market for it, but you can eliminate this common pitfall by asking for honest feedback.
Identify the Gap
A successful gap identification process is dependent upon your ability to think “outside the box” without being overly complicated. As Shark Tank’s, Kevin O’Leary often says: “it is the simple ideas that make money.” Take out your trusty notepad and pen or open your smartphone app and thoughtfully articulate your business’ mission.
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If you can clearly identify the gaps in the market that your business idea will fill, then it is an idea you can confidently consider bringing to fruition. Summerhouse24, for example, differentiated their offering from other players in the market by not only providing competitive pricing but also allowing customers to build their own summerhouses. According to Young Entrepreneur Council, you can extract an idea in a market by identifying the pains of its major players.
You can achieve this by answering two imperative questions:
- What is the most important thing that you need to do in your business?
- What are your pain points associated with that activity?
Your responses to these two questions will help you identify a gap in the market and formulate a potential solution. Another successful example of this is the way Massage Therapy Schools Information identified a lack of preparation material in their market and filled it by providing state-specific information for individuals interested in becoming certified massage therapists.
Find an Idea Where the Path to Profit Is Simple
O’Leary also revealed that one of the major components of a startup at which angel investors look at is the ability of the entrepreneur to explain how they will make money in the long term. If an idea has a distinct money-making strategy, then it is also worth considering.
Once you have identified an idea that can be monetized, conduct a quick analysis to gain insights on how others have made it in the industry. The 4 Hour Work Week author, Tim Ferris, recommends studying the business model of the most successful entrepreneurs in your niche to help you define your approach in how you will differentiate your offering and best serve your audience.
If everyone in your market is simply selling a product, add value that is above and beyond your competitors’ by offering an additional service or guarantee at no added cost.
Develop Thick Skin
As an entrepreneur, your success will be determined by your ability to pull strings. Your idea’s success will be determined by your persistence in taking it to the next level, which will require you to make intimidating calls and in-person pitches in order to set your idea in motion. Always remember that rejection is inevitable, but the more you face it and gain the ability to learn from it, the higher the chances that you will succeed.
After identifying an idea with the highest probability of success, make a list of the people that you think will help you towards its implementation. Be prepared to face resistance and brave enough to persist even when the threat of rejection is evident. More often than not, you will find that people pay closer attention to you and are more open to supporting you when they discover that you are resilient and determined to bring your idea to market.
Ditch Your Failing Ideas
You have to let go of former ideas that are simply unrealistic in order to effectively identify and implement a great idea. Many entrepreneurs make the mistake of pushing forward with an idea that they are not able to monetize, and find themselves so caught up in the fallacy of its success that they lose the courage to start over.
As an entrepreneur, you must be able to recognize the difference between being passionate and being illogical. The sooner you cut your losses and move on, the quicker you can focus your time and energy on another idea that could possibly result in a successful business opportunity.
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The Sport Nutrition Review Company, Protein Daily, initially aimed to make its mark by providing supplement product reviews online for bodybuilders; however, they failed miserably. There was simply no gap in the market for another bodybuilding website since there were so many others that essentially provided the same information that Protein Daily offered.
By narrowing its focus strictly to comprehensive protein product reviews, it was able to reach a wider audience by gaining acceptance as the leader in that vertical. Successful entrepreneurs are not just people who come up with flawless ideas but are also those who are nimble enough to change course without becoming discouraged.