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“Anyone inventing products should be able to articulate a robust theory of human nature”
To start, I’d like to say that startups really aren’t for everyone.
I think that startups become popularized in the past few decades because of technology trends, but that doesn’t mean that everyone should become an entrepreneur with VC scale business aspirations. I honestly believe that this world needs more teachers, good politicians and government personnel, social workers, artists, and small business owners instead of Silicon Valley CEOs, but hey, one dude’s opinion.
Ideally, startup ideas come from one’s own experience of a “pain point” in their personal (consumer) or business life. This pain point becomes a problem for the prospective entrepreneur to solve, possibly by using tech. When the particular problem is experienced by many others as well, it can have that potential for high growth that defines a startup (startup = growth potential). If tech isn’t the solution to the problem, it can be used as the delivery method for providing the solution to a bunch of people. Again, this process:
If you’re not experiencing many problems in your present day life, maybe it’s better to try the futurist approach and think about all the cool stuff that hasn’t been invented yet (ya know, like in Back to the Future or Minority Report), or market trends based off of present day technology, or (better yet) the problems we will face in the future. However, this usually only works if it’s the right time to try to bring that future idea into the present.
If you have a startup idea, or even the start of a startup idea, then you can skip this, and check out my post, How To Validate Your Startup Idea.
If inspiration just isn’t hitting you, and you are dead set on being a startup entrepreneur, I’ll present a brainstorm strategy that’s worth a shot. After all, you need to go get those internet monies, right? $$$
Ideally, if you don’t have an idea, you have an area of interest, i.e. fitness, travel, shopping, etc. that you would like work in. It’s pretty important to work in an area that you find interesting, because startups can be really rough at times, and if you aren’t passionate about what you’re working on, you’re more likely to give up. There is also a chance that this will become your life’s work. So please, if you don’t have an idea, think hard about what your area of interest is.
Identify what your interest is, and then think of the demographics (age, income, etc.), psychographics (attitudes, feelings, etc.), and technographics (social media adoption, smartphone usage) of consumers who also have this interest. They should also be tech fluent and have discretionary income.
**For my friends outside of the USA, a few other interview activities:
If you’re having trouble finding the consumers to interview, try posting on Facebook, attending an event like a concert, or canvassing a grocery store or train station. Hustle. Use your imagination.
Think of businesses that have the appropriate number of employees and revenue to warrant a monthly software license spend. These companies don’t need to be huge, but you probably want to stay away from sole proprietors and startups. Think of businesses that are in verticals (i.e. finance, auto, retail, etc.) becoming increasingly stronger adopters of SaaS. And think of the roles (i.e. CEO, VP of Marketing) of the decision makers and influencers in these kinds of business.
**For my friends outside of the USA, a few other interview activities:
As you’re asking these questions, take a bunch of notes while they’re talking, and ask them exploratory questions. Be an active listener. Dig deeper into what their deeper motivations are.
If you’re having trouble finding professionals to talk to, try posting on LinkedIn or attending an event like a conference that has an exposition area (usually tickets are cheap for expo floor only). You can also try contacting people via cold email, which I explain in my post How to Acquire Initial Clients for your B2B Startup. It’s important that you clarify that this is just for personal research, and will not be shared or used for anything else. They may also think you’re trying to sell something, so please clarify that as well.
The aforementioned exercises are geared at giving you information to get ideas from other people’s and businesses pain points. These interviews require that you adopt the mindset of a detective and a psychologist. You’re looking to create a product that will be inherently useful or interesting. This said, all this does is give you ideas. It doesn’t necessarily prove a market for any of these ideas, and it doesn’t necessarily mean that these ideas would make a good startup.
Really can’t emphasize this enough. If it doesn’t solve a real pain point for a group of consumers or businesses, your product probably won’t be adopted. You don’t need to think of something radically new though, or try to find a problem that has no existing solution. If you “10x” an existing experience (make the experience 10 times better than it currently is), that works well; Uber did this with taxis, Gusto did this with payroll. Just be careful that the pain point that you’re trying to solve is actually a real problem, and that you’re not just “2x-ing” an experience.
Timing plays a huge factor in startups, and it’s one of the harder factors to control for. Consumers and business need to be ready for your product. Both their online and offline behaviors and motivations need to align with your product. And the technology and technology adoption required for your idea needs to be feasible at the time. Think if someone had tried to start Facebook in 1994 as opposed to 2004. Now think if someone had tried to start Facebook in 2014 as opposed to 2004. See the issue?
Ideally you would have both expertise and the right team, but either will do in my opinion. If you’re starting a healthcare startup, it helps if you’re an expert in healthcare. If you’re not an expert in the industry that you’re disrupting, a good team can give you the advantage you need. Teams that are well balanced with business, technical, and design skills, and know how to execute on ideas will get ahead of that lack these abilities.
Remember, startups are defined their ability to grow. That’s what separates a startup from a small or regular business. So if your product is only of interest to a very very niche group of consumers or businesses, it might not be a good startup idea, perhaps a small business. That said, keep in mind that the portable toilet business in the United States is worth over $1 Billion per year.
Beyond expertise, is there something that makes you special. Do you live in a foreign country, where you have a limited competitive landscape and can take cues from Silicon Valley startups? Do you have serious connections to venture capital or other investors? Do you have connections at big companies who can become your first clients? These are all advantages that can put your ahead of other startups.
If your idea is so simple, or your tech is easy to clone, or there is nothing particularly unique about your team for this particular idea, there is a chance someone will knock you out of the race early on. Right now, for every pain point you can think of, there are probably like 5 teams working on startups to solve it. Try to have an idea that can’t be replicated in a month.
Cross reference your ideas against these criteria. It doesn’t need to meet all of these requirements, but it should meet most.
Hopefully, the aforementioned gives you a starting point for brainstorming potential startup ideas. To be honest, if you don’t have a startup idea to begin with, you may be better off waiting until inspiration strikes you naturally.
It’s very possible to train your brain to looking for problems to solve in everyday life by changing your perspective. To start, try simply observing people around you and ask yourself questions about how they might get their job done, or save money for retirement, or find a babysitter for their kids. Every day, force yourself to write down 5 startup ideas, even if they are silly or stupid. Your creative mind is a muscle; it can be exercised and strengthened.
Once you have an idea, the work really begins. It’s not just enough to have a great idea, you need to get some proof that this is actually an idea worth exploring. Time is valuable, and before you invest any time into building a product around your idea, you need to make sure your idea is validated. For those new to startup terminology, market validation refers to a series of interviews, or other data, that test a product concept against a potential target market (business or consumer). I provide a detailed explanation of how to approach market validation in my first article about How To Validate Your Startup Idea. You can check it out.