Three Questions To Ask Yourself About Your New Business Idea

business Feb 24, 2020

In 2020 it may feel like there are endless opportunities to try your hand at Entrepreneurship and the truth is there are. 

 

From online courses, franchises for purchase, startups, or brick and mortar corner store necessities the world is an oyster if you’re brave enough to take the leap. 

 

However, while the opportunity is there, also present is a never ending swirl of options. You may find yourself asking, “What’s right for me?”, “Can I afford to launch it”, “How do I know if this is a good idea?”

 

Here are 3 questions you should dive into before committing to a business idea: 

 

How Soon Can You Take Action? 

The first thing you need to assess is the actual feasibility of you “doing the thing”. How quickly can you pull the trigger? 

 

If your dream business model is an app or software technology, but you personally know nothing about writing, and refining code you will likely have to onboard coders who can do the heavy lifting. This model, may need significantly more capital than another start up idea you are weighing where you can do the majority of the work--in the early days at least. 

 

Here’s an important rule of thumb: If it would take an additional full time salary hire to even get the idea properly formed, it may not be the one to start with. 

 

Is the Market Warmed?

Once you have established that the idea is at least somewhat “doable” grab a cup of coffee, your closest internet enabled device and do some thorough searching. 

 

You’re looking for similarities in the marketplace that have already launched. Chances are that your idea is in some form out there in the market. By identifying a soon to be competitor you can start to get a gauge of what the customer based likes about the offering, or ways they may not be being served completely. 

 

Ask yourself these questions: 

  • Could I do this better? 
  • Is there a service I could offer to one of these existing businesses instead of competing with them? 
  • Can I serve an even more niched audience the same product or service? 

 

If you answered yes to any of the above, move on to the next question. 

 

Do you really understand who your customers would be? 

The next step to validating your business idea should be to completely understand who you are serving. 

 

Here are some BAD examples of customer demographics: 

  • Women of color 
  • Millennials 
  • Mothers 

 

Why are these not satisfying outlines of customers you will reach? Because, while those groups may be valuable shapes of a demographic, each of those groups have unique identifiers within them that control how they think, make decisions, and ultimately purchase. For example, not all mothers have the same values and problems to solve.

 

A much stronger way to think about your business’ customers is to outline “Customer Avatars”. Here are a few examples: 

  • Small businesses, owned by women of color, earning $2000-$5000 in recurring revenue each month who are looking for mentorship in business development 
  • Black Millennials who are content creators, with 20,000-50,000 social media followers that need social media advertising services
  • Mothers who are looking to start work from home businesses in the Accounting/ Bookkeeping space. 



Summary 

 

There’s a lot that goes into launching a new business. But these three questions are the foundations to validating an idea you can take action on in the short term. 

 

Ask Yourself: 

  • How soon can I take action?
  • Is the market looking for this solution?
  • Do I understand who I’d be selling to?

 

The biggest thing to remember is that it is a lot easier to build a business that you know the market is already looking for, than to build a business you have to persuade people to buy in to. 

If you’ve found a problem, build a solution and the business will always be a lot stronger than an idea that just felt good to talk about. 

 

-WorkSmart

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