When a good business idea comes along, you have to take control of the situation. Building it from the ground up is hard, and may not always end in a favorable way. But how do you tell the difference between a good or bad business idea?
A New Business Idea Doesn’t Have to Be New
If your business satisfies a customer’s needs, then it is a good idea. There is always room in the industry for a new product or service. That is why there are several colas, plenty of bottled waters and a ton of plain chocolate candies.
But when your new idea is nothing more than reinventing the wheel, a sanity check is in order. Bullpreneur has several examples of ideas that have revolutionized the business industry. If there is a chance that your idea will be considered the inferior of two similar products, then it is a bad idea.
An Idea Should Not Be a Money Pit
There are hundreds of business ideas that sound great in theory. Once you put the idea on paper, it becomes a convoluted mess. An idea can be incredible in its own right but not good for your current situation.
If Monster Energy decides to create a brand-new line of luxury bottled water, it is an acceptable risk. But if you as an individual decide to create your own brand of luxury bottled water, then it is an insane risk for a new business. Always consider the financial impact of any big idea you want to bring to reality.
Crowdfunding Companies Exist for A Reason
Crowdfunding in the modern age has been a win-win for several startup projects. A huge portion of the project is about companies expanding or meeting their current goals. Include crowdfunding in your business plans, and pay close attention to the results.
If several crowdfunding companies pass on your idea, then there are flaws that you keep overlooking. Ask them for an honest evaluation to get the answer on why your business idea falls flat. It’s normal to push back against bad advice when you see a different path. Investors are not the type to turn away easy money. So, if they’re turning down your ideas, take a long look at your own flaws.
Write Multiple Executive Summaries
Creating multiple executive summaries about your business idea is a great way to determine its validity. A business plan gives you too much space to create a word salad about why your idea is great. With an executive summary, it has to be short, concise and to the point. If you struggle to explain the idea in a compelling way, then chances are it is a bad idea. There is no such thing as a business idea that is too complex to explain in an executive summary.
Take Your Time
A big idea can overtake your rational train of thought. Keep your common sense in check and do the legwork necessary to ‘feel out’ any new idea. If you’re serious about making money, then business ideas will come every day.