Going Beyond the Napkin: How Do You Know If Your Idea Is Any Good?
If you’re an entrepreneur, you have new business ideas all the time. Entrepreneurs like us see the world as a place that can be constantly improved—we know we could make products and services that make things better.
The problem is, not all of our ideas are great. They might seem good at the moment, but not all of them are worth turning into real businesses.
Starting and running a business is a big commitment. It’s a ton of work and isn’t something to be taken lightly.
So, how do you figure out if your ideas are any good? How do you separate the good ideas from the bad?
I’ve had this problem in the years I’ve spent running and growing businesses. I’ll think I have a great idea, work with my team to start, only to discover later—after wasting co-workers’ time—that my idea wasn’t any good.
To solve this problem, I’ve come up with a system that helps you separate the good ideas from the bad ones. It’s an easy process that you can put to work for you today. Here’s how.
1. From idea to pitch
The key to figuring out if your idea is any good is to take a few minutes to figure out some of the details. You need to get your idea out of your head and onto paper so you can take the next step to figure out if your idea is any good.
The good thing is that you don’t need to write a complete business plan to figure out if your idea is good or not. That would take too much time and be pretty useless at this early stage of turning your idea into a business.
The first step is much easier than that. The first step is to create a “pitch” for your business—a simple, one-page overview. Here’s what you need to include:
Start by writing down your value proposition: one sentence that describes the value your company will give to your customers. Here at , our value proposition is to provide “Tools and advice to make starting a business easy.” Keep your value proposition to one sentence. Imagine that you have to describe your business on Twitter and use that 140 character limit to help you distill your idea to its core essence.
Next, describe the problem you are solving for your customers. Again, one sentence or a few bullets are plenty. Keep this as short as possible. For we describe our customers’ problem this way: “It’s hard to find easy-to-understand, trustworthy advice on starting a business.”
The natural counterpoint to your customer’s problem is your solution. Use a few bullet points to describe how you solve your customer’s problem. This is basically a short description of your product or service. What does your business do?
Now that you’ve defined the problem you are solving and your solution, write down your target market. This is a brief overview of your ideal customer. Who are they and what do they look like? Are you targeting busy executives or working parents? Perhaps your target market is iPhone owners who want to take better photos. Take a few minutes to jot down some bullet points that describe your ideal customers.
Your customers probably have a way that they solve their problem currently. This is your competition. Every business has competition and it’s important to understand how you’ll compete against them. Is your solution better? Cheaper? Faster? Maybe a combination of all three? Jot down a list of your potential competitors and how your business might be better.
Think about how you’re going to sell your product or service to your customers. Write a few bullet points about how your sales will work. Separately, write a few notes about your key marketing activities. Again, this doesn’t need to be detailed. All of this information is going to fit on a single page, so two or three bullet points for each topic is all you need.
Finally, spend a few minutes thinking about how you’re going to make money. Write a quick list of the ways you’ll generate revenue. At the same time, think about your most important expenses like rent, salaries, and other costs. Don’t worry about writing down actual numbers at this stage. Just list the key ways you’ll make money and the biggest expenses you’re going to have.
If you’ve followed along so far, you’ll have a one-page pitch—a simple overview of your business idea. If you need a template for all of this, you can download one here.
Hello!
I’m Andrew Brooks, a seasoned finance consultant from the USA and the mind behind phonenumber247.com.
My career is built on a foundation of helping individuals and businesses thrive financially in an ever-changing economic landscape. At phonenumber247.com, my aim is to demystify the complex world of finance, providing clear, actionable advice that can help you navigate your financial journey with confidence. Whether it’s personal finance management, investment strategies, or understanding the nuances of market dynamics, I’m here to share insights and tools that can propel you towards your financial goals.
Welcome to my digital space, where every piece of advice is a step closer to financial clarity and success!