Develop a Business Idea

Develop a Business Idea

Arguably the hardest part of creating a successful business is the conception. With a vast market of competitors in most industries, creating or improving upon an idea is becoming increasingly challenging. Before investing too much time, energy, and capital into a venture, it is essential to be able to answer important and basic questions.

What problem is being solved?

Businesses are formed to create value in the market. If a business does not serve a purpose, it will not be successful. When analyzing a potential business idea, the first thing to consider is whether or not this idea solves any problems or improves upon any processes or products that do.

The business could be intended for the general population or more niche sections, but regardless, needs to be innovative.

What is your competitive advantage?

If you provide a product/service that is marketable and creates value for its users, an important consideration is what competitive advantages can be utilized.

A competitive advantage is an aspect or feature of a company or product that helps it outperform competitors. In most industries, especially the technology industry, companies are always advancing at a fast rate, so it is vital to have some sort of competitive advantage.

Evaluate opportunities and current assets

After recognizing the ultimate purpose of the company is and what competitive advantages it can have, evaluating opportunities can help determine more details about the potential business.
This step is just an introduction to much larger parts of the business, but are crucial to consider while still planning the business.

Who are your customers?

This question will have to be revisited following additional market research but identifying your target audience also needs to be considered early in the process. When determining your targeted consumers, things to consider are age, location, language, economic status, sex, and interests among other things.

The more specific your target, the better you can build your business around them.

What will it take to execute?

Being aware of the requirements to make a business succeed is typically easier said than done. Having a successful technology company requires technical expertise, sufficient staff, financial backing, and access to market resources are just a couple.

How does your business generate profit?

One of the most important ways to ensure continuity in business is to always be profitable. Your product/services must generate profit, especially early on. If you are building an app, there are several ways to generate revenue, including:

  • Advertising
  • Pay per download
  • (Non) Consumable in-app purchases
  • Subscriptions
  • Licensing/royalty fees
  • Contract work/commissioned apps

There are many other ways aside from the strategies mentioned above to gain revenue from a “free” app.

Are you a sole founder?

Creating a business requires a significant time commitment and taking the journey alone is difficult, but possible. The appeal of being the sole founder of a successful tech-company and being able to control all aspects of the business is there, but that may not be as glamorous as it sounds.

Pros:

As a sole founder, you have the flexibility of making quick decisions. Rather than waiting for others in the organizations, you can jump on opportunities as they arise. It also allows you to focus on the business without the office politics that are often found in the workplace.

Cons:

With the constant innovation in the tech industry, it is hard to brainstorm new ideas when there is no one to bounce ideas off. Being a sole founder means having complete responsibility. When things go wrong, it is easy to get overwhelmed and the business can suffer because of that.

Developing a business idea is difficult because it of all the considerations that have to be made based on limited knowledge. While it may not be easy, it is the better alternative compared to investing heavily into an idea that does not have a chance in the market.