Startup ideas are a great starting point. Even though 70-100% of startups will likely change once the first potential customers come onboard, the initial idea that you start with determines where you end up in the long run. The market you choose, the customer pain you decide to attack, and the solution you come up with, all affect the size of the outcome.
So, if you’re an entrepreneur or potential entrepreneur, with skills or enthusiasm to get started, but you don’t have an idea yet, here’s a brief guide to get you started.
1. First Follow Your Skills, Then Your Passion
As argued in some of our previous posts, passion is not always the best guide in picking the right business idea. We have many passions; some stay, some change and others burn out. However, progress and success can eventually turn into real, lasting passion.
So when looking for ideas, assess all of your skills first. Think about what the key areas are that you can be the best at. Put them down in a list and then let the passion have a say.
2. What Problem Can You Solve?
The real money is in problems. If you solve an unaddressed pain that’s big enough, people will give you chance. The best place to start is to solve a problem that you have, that you can understand. For example, AirBnB founders were short on rent one month, so they decided to sublet a room in their apartment to strangers travelling to Bay Area for a conference. Voila, new business idea.
3. Find a Big Market
Even if you don’t have any particular problem, there are plenty of huge markets riddled with problems. Real estate, insurance, legal services, healthcare, etc. are trillion-dollar markets that haven’t changed for decades. To give you more ideas, this list from Y Combinator lists some of the hottest markets for disruption.
Go out and talk to potential customers and discover big, monetizable problems. Start with industries and markets that you understand the most.
4. Find Secrets
What are some things everyone believes that are actually not true? Peter Thiel, who started two billion-dollar startups and funded companies like Facebook and Tesla, believes hugely successful startups are built around secrets.
Steve Jobs, Mark Zuckerberg and Bill Gates all were, in a sense, contrarian thinkers. Nobody believed Facebook would be as huge as it is now, and personal computers were laughed at in their early days. These people understood something nobody else did.
5. Look for Lack of Regulation
Uber and AirBnB were practically illegal until they become too big not to be legal. The reason they’ve grown into billion-dollar companies is that there wasn’t enough regulatory framework to prevent them to build their services. And while they were small, nobody cared. Now that they’re big, they’re too big to be shut down.
In fact, a lack of regulation is one of the defining characteristics of startups. For example, when PayPal started, there was little regulation in online payments. Today the industry is overregulated, making it quite difficult for startups to enter. It’s the same story with healthcare and many other markets. If you can find a new, big or fast-growing market with a lack of regulation, it might be a great place to look for ideas.
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