Ready to take on the world of entrepreneurship? In order to find startup success, you need a great business idea. But a winning business idea is more than just something you’re excited about or good at — you have to make sure your idea is actually viable.
Business News Daily asked experts how you can tell if your business idea is poised for success. Here are 10 questions to ask yourself before pursuing your business idea
Does it solve a problem?
Entrepreneur and co-founder of the Web design school The Starter League Mike McGee thinks the best business ideas are those that solve a problem in some way.
“If there is a problem that affects you, your friends, family, co-workers, etc., then the chances are high that it affects people you don’t know as well,” McGee said.
It’s paying customers who validate an idea and determine which ones have the greatest chance for success, said Wil Schroter, co-founder and CEO of Fundable.
“An idea is just an idea until you have a paying customer attached to it,” Schroter said. “Anyone can discredit a simple idea, but no one can discredit paying customers.”
What’s your price point?
Charlie Harary, founder and partner of investment firm H3 & Co., said that while there are many ways to solve problems, great business ideas do it in a way that is less expensive than what the market will endure.
“Once you have determined that you are solving a legitimate problem in a scalable way, you need to determine not only the value that it delivers to the world, but what people would pay for that value,” Harary said. “Once you determine the price, then you can assess if your solution is business worthy or not.”
Can you explain your idea in the simplest terms?
Your business may solve a complicated problem, but you should be able to explain it in simple terms so that anyone can understand it, said Kris Duggan, CEO of goal Management Company. Duggan suggested using what he calls “the grandma test.”
“When you typically hear someone pitch their idea, it’s usually chock-full of important-sounding jargon that rarely makes sense,” Duggan said. “When you think about your new business idea, ask yourself, ‘Can it pass the grandma test?’ In other words, would your grandma understand what you do? Perhaps your business is solving a complicated problem, but early on, come up with a way to explain it that makes sense to the masses.”
Are you being realistic about your goals?
As excited as you may be about a new business idea, it’s important to stay grounded and be realistic about it. Thomas J. Gravina — chairman, co-founder and CEO of cloud services company — said you shouldn’t have a “Field of Dreams” mentality when starting your business.
“Just because you have a vision and decide to build it does not mean the rest will follow,” Gravina said. “While you may have an idea that is original, revolutionary or ahead of its time, there should be a real, solid market opportunity to ensure it is successful. Any new business case or new endeavor has to have a viable market that you believe you can sell now — not theoretically or on the premise that there is a future for this market.”
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