What makes a good business idea? Good business ideas are only good if they are likely to lead to a profitable and viable business. In other words, they tap into a market opportunity. We all have all sorts of ideas (all the time if you are like me 🙂 ) but not all of them make for good business ideas.
So it makes sense to look for good business ideas in places where you are likely to find them. Here’s 9 areas where you can find ideas that are likely to become a viable opportunity:
9 proven ways to find good business ideas
1. Find a specific problem and create a solution.
Buffer is a great example here. They identified a specific problem that Twitter users had – they couldn’t easily stagger the RTs of interesting tweets they found. Buffer built an app that neatly solves the problem and is massively growing its user base as a result. (If you use Twitter and haven’t used Buffer yet, you should check it out.)
2. Find an area where further improvement or development of an idea could be valuable.
This is the “build a better mousetrap” strategy. The key word here is valuable. You can improve something, but it only becomes more valuable if the customer cares about the improvements and is willing to pay for them. This really depends on finding the right target market.
For instance, personally, I don’t really care that much about what kind of car I drive as long as it’s reliable, comfortable and doesn’t cost me too much money. The car companies could make all the improvements they like, but my response would be “Meh. Nice to have but I’m not paying extra for that.” But for someone who really loves cars and who values their performance, those improvements may be valuable and hence they would be willing to pay more for them.
3. Find a fault in a product or service and remove it.
This is the classic case where a company comes in and removes inefficiencies and disrupts an industry.
An example would be when Google first entered the market with their search engine. At the time, other search engines would throw up a lot of irrelevant results as well as results that were what the user was looking for. Google worked out a way to fix that fault in search and the rest is history
4. Find an area where there is something missing in a product or service and supply it.
This is essentially the opposite of the previous technique.
5. Find a perceived gap in the market
This could be as simple as starting a business in a geographical area where there are no competitors, such as an organic produce shop in a suburb where it is hard to otherwise access organic goods. It could also be creating a new product or service to fill a perceived need. Examples are co-working spaces that are popping up all around the world, or the hundreds of baby products that seem to be invented every day. The trick with this strategy is validating that there is indeed a need for your product or service before you spend too much time or money on it.
6. Find an area where the current way of doing things imposes a high cost.
The internet has spawned thousands of businesses who take advantage of this kind of opportunity. Examples here include udemy.com and learnable.com who have brought down the price of training and professional development by delivering courses online.
7. Find an area where there is a need which is not being met.
This need may be something that people are unaware of. An example here is the development of the iPod by Apple. Until they launched the iPod, no one realised they needed to carry their whole music collection around with them, but as soon as it was released, it was a must have item.
8. Listen to your hunches.
You may have a feeling that the payoff on a particular idea will be large. The more practice you have coming up with and validating ideas, the more on the money your hunches will tend to be. Make sure you do some research to validate your hunch before you invest a lot of time and money.
9. Make a wish come true.
These are the ideas that start with “Wouldn’t it be nice if…”
- Wouldn’t it be nice if we could go into space on holiday – Virgin Galatic
- Wouldn’t it be nice if when I bought a pair of shoes someone in the third world could have some too – Tom’s Shoes
- Wouldn’t it be nice if we could provide clean drinking water in poor communities – Thankyou Water.
If you are really serious about coming up with some good business ideas, put your action where your mouth is and try this. Set a timer for 25 minutes. Create one idea for each of these categories and see if you can come up with some good business ideas that may also be an opportunity.
You can do it! Let us know how you go in the comments below.
If you’ve found this helpful, you’ll love my video series on how to use my proven process to create great business ideas that give you an unfair advantage. Click on the banner below to get access.
Thanks to Bill Jarrard and Jennifer Goddard of Mindwerx who originally outlined these 9 areas.
Images used courtesy of Adrien Leguay and United Nations Photo under Creative Commons license.
I think you were on the right track with #1. Find a specific problem and create a solution, but you missed some key points. How or where do you actually find the problem? This is probably the best and most underutilized method for finding profitable ideas out there today. The answer is to start with your customer or your potential idea customer. Even better, just pick a niche industry and starting talking to businesses and consumers. Find their pains, issues, problems. During this process, you will discover so many business ideas you won’t know what to do. This approach is called “Idea Extraction” a subject I have dove into fully in the last year and love it.
You’re right Tyler. There is a lot more to be said about problems and solutions. But that is the topic for a whole other blog post!
Thanks for your thoughts
I’ve found basically two ways of how you can find a good business idea: (1) bottom-up and (2) top-down. Heiko Hubertz (founder of BigPoint) shares his insights how he got his idea on http://www.entrepreneurial-insights.com/how-to-find-a-good-business-idea-2/
Have a great day,
I think your first point really covers all of them. Find a problem, and solve it. And there are a million ways to find that problem and go about solving it.