This guide is all about Idea Generation, the first part of the ‘Your Step By Step Guide To Business Launch’ from Blueprint Entrepreneur Magazine. This guide focuses exclusively on finding a business idea to test from issue one.
Here you’ll learn techniques for generating near infinite ideas and then how to refine those ideas using proven methods of exclusion to find a few good ideas that you can further explore and test.
This is not THE guide. There is no “one way” to start a business. There are however principles that are proven to work, and the power is in understanding how they overlap and combine to form a viable business. Look at it this way. If we sat down to interview 100 successful entrepreneurs about their path, the result might be something like this:
- Entrepreneur #1 did A – B – C;
- Entrepreneur #2 did B – C – A;
- Entrepreneur #3 threw a Hail Mary and it paid off big time A – D – B – C
The permutations are infinite. But still, there are proven techniques that work, and this actionable guide starts with how to find a business idea that you can test.
Who is this guide for?
One principle we go through in the magazine is niching down to target a very specific audience. This guide does the same. This guide will be most useful if:
- You’re an entrepreneur that is constantly asking “What do I need to learn and do to build up my business?”. Then once you find that information really commit to take action, react to your mistakes and constantly improve.
- You’re ready to work hard for yourself and know there are no shortcuts.
- You understand great wealth in business comes from helping others.
So in short. You’re a hard working action taker looking to truly help your clients. That being said, there are going to be readers that this guide isn’t well suited for.
Who should put this guide down… like right now.
Ramit Sethi, who has earned millions launching courses from his blog, once told me it is just as important to know who you aren’t targeting as it is to know who you are targeting. I’ve seen this exclusion clause done well and done poorly. Here are some bad examples:
- You shouldn’t read this personal finance book if you already have too much money.
- This laundry soap probably isn’t right for you if you take all your clothing to the dry-cleaner.
- You don’t need this pickup artist video if you already “get” all the girls you want.
Ramit doesn’t let people with credit card debt join his expensive courses – THAT is a real exclusion. Here are a few that apply to this guide:
- We are not a motivational magazine with lots of feel good stories.
- We are not helpful hints that are common sense but never implemented.
- We are not online strategy for the sake of following trends.
- We are not for the unmotivated.
- We are not for people that don’t help their clients.
- We are not for people looking for a get rich quick scheme.
We are for action takers – We know this guide won’t be 100% relevant to you if you’ve already found your business idea and are further along. But if you look, you will find something useful that will help you grow your business now.
Who am I?
Alright, “Who am I?”. One of the biggest questions of all time, and I’m going answer it in a short paragraph so we can get you to the good stuff. But it is important to establish credibility – the techniques in this article have either worked for me or entrepreneurs in my network. I’m Michael Alexis. In 2010 I started my first real business. It was a Groupon Clone called SaveRally. I got local businesses to offer exclusive deals to students at my college. I wasted a lot of time trying to appear as a big company, and in the already saturated market my business suffered. Still, it was profitable from day one and I eventually sold the site for a great return. When I realized there was quicker money in flipping businesses, I started and sold another daily deal site in less than a month. Besides my own startup, I’ve worked from the ground up on iPhone apps and opening a restaurant in Beijing, China. I’ve also worked with entrepreneurs like Ramit Sethi of I Will Teach You To Be Rich and Andrew Warner of Mixergy – learning a tonne from the sophisticated way they’ve grown their own businesses. But enough about me…
Ground Zero: Bringing Your Seminal Idea Into Existence
The first step in your business is idea generation – and unless you’ve already done some background work, this is our ground zero. The idea will evolve over time as we survey the target audience and consider their feedback, but it has to start from somewhere – otherwise how are you going to know who to survey? Everybody? Our expert on idea generation is James Altucher.
Expert: James Altucher
After the September 11 attacks, James’ net worth plummeted. But before going completely broke, he wrote some software that helped him trade stocks. That earned him $40,000 per month for the next 12 months. Then he launched Stockpickr.com, a “MySpace for finance”. The first draft of the site cost him $4000. It earned $90,000 per month from launch, and he sold it five months later for $5 million. Now, James is a prolific writer. He has published 5 books with traditional publishers, and self published two more. His online writing has appeared on TechCrunch, Forbes, Huffington Post, Financial Post and of course JamesAltucher.com. You may want to read: The 100 Rules For Being An Entrepreneur; and The Easiest Way to Succeed As An Entrepreneur It was posts like these that inspired Ramit Sethi to describe James as “one of the best writers anywhere.”
The Daily Practice
Perhaps what James is best known for is The Daily Practice, a set of rules by which he governs his physical, emotional, mental, and spiritual health. Each of these categories breaks down into individual practices:
Detailed steps on health practices are beyond the scope of this article. But you can learn more in the Idea Generation: Additional Resources section. What is important is James’ two-tier idea generation system.
Generate Infinite Ideas In Two Simple Steps
This is the first interactive step to this guide. Get paper and pen – we all know digital sticky notes and “reminder emails” end up in good intention purgatory. Now, make a note of a 10 minute period you can commit to every day. I recommend noon – before you eat lunch – so your mind isn’t revved up around bedtime. Just know that the words matter less than the action of writing. Especially in the beginning as you are building your creative muscle. Use Charles Duhigg Insight Into Habits:
- Put your writing task in the calendar, set the alarm, and also leave out your writing pad and pen ready to go.
- Reward yourself consistently with one small thing after your creative session.
- Have a piece of chocolate
- Talk to a friend or colleague for 20 minutes
- Browse the web for 15 minutes
- Grab a coffee or smoothie
- Play an iPad game for 5 minutes.
- Choose one you enjoy and remember to consistently reward yourself to build a very valuable habit.
- Don’t just rely on trying harder – It’s too hard. Especially if the daily tasks aren’t obvious immediate wins for you. You need small wins on your journey of entrepreneurship. So give yourself those small rewards along your road to success.
Step One: A List Of Things To Make Lists About The goal is to make a list of broad categories that will break down into specific business ideas.
- 10 businesses I could run from home
- 7 businesses that cost less than $25 to start
- 100 businesses that I don’t want to do
- 5 new ways to make money from online video
- 3 industries that are ripe for disruption
- 8 businesses that are doing a crappy job of serving the market
- 10 products I could launch from Kickstarter
- 6 markets my employer is ignoring
- 12 businesses that start with the letter ‘L’
- 10 mini-businesses that I could launch in less than 48 hours
- 20 ideas for online shops
- 15 things my kids would definitely bug me to buy for them
There are subtleties of each list that allow you to flex different idea muscles. Naming 7 businesses that you could start for less than $25 demands a scarcity mindset, while 6 markets your employer is ignoring may help you identify markets where you already have expertise. Here are some tips for creating your own list of lists.
- Don’t think too much about it. Just write whatever comes to mind, nobody is going to be like, “hey, your ideas suck”.
- Aim for variety. You may already know you want to start a software company, but making a list of “10 ways McDonald’s could change its distribution model” might just give you a surprising insight.
- Aim for volume. More the merrier.
- Write at the same time every day. Yeah, if a meeting went long and you missed 12 noon, write it late. But make this a priority.
- Never miss a day. Avoid cheat creep. You know, when you skip your workout one day, and then it is harder to do the next day. Commit to making your lists every day.
- Team up. No need to do this alone. You and a friend can write and share lists – double your stock of lists with just a little extra effort.
- You don’t need special equipment. Moleskins are awesome… James uses waiter pads.
- Reward yourself. Giving yourself a small reward each time you finish helps to form a great habit.
- Remember this is a process. You will get better at list making over time.
Okay – start now. Copy out the template on the Action Step below and do not go to the next step until you have created your first list of lists.
ACTION STEP – Finding Your Idea
I promise to write all my ideas no matter how good or bad they are at _______am/pm every day for 10 minutes so that I can find a business idea to test. After my writing session I’ll reward myself with ________________________________. Name: Date: Signature: You need:
- Friend (optional)
- Don’t think (worry) too much about it
- Aim for variety
- Aim for volume
- Write at the same time every day
- Never miss a day
- Team up if you want
- No need for special equipment
- Remember this is a process and you will improve
- Give yourself a small reward once your done
Activity 1: Create a list of broad categories that will break into specific business ideas. Lists of Lists: Broad Categories
- 10 businesses that I could launch in less than 48 hours
- 10 businesses I could run from home
- 7 businesses that cost less than $25 to start
- 15 businesses that I don’t want to do
Step Two: Lists of Specific Businesses
Once you have your lists of lists, it’s time to generate specific business ideas. Same as before, commit to doing your list making at a specific time each day. Basically, you are just taking one of the categories from above, and building a list around it. Here are some examples:
20 ideas for online shops
- wool socks
- infinity scarfs
- self-charging luminant house numbers
- iPad backpack
- gluten free fortune cookies
- abandoned pets
- historical antiques
- refurbished rocking chairs
- watches for geeks
- wooden cufflinks
- his & hers wristbands that get warmer the further you are apart
- parent & child wristbands that beep when they are separated by 10 metres or more
- hand made one of a kind store
- only beach toys
- how to throw a boomerang ebook & boomerangs
- custom fake tattoos
- recipe and ingredients delivery
- cardboard furniture
- sublimated table cloths
- re-usable stick on back covers for iphone
As well as the tips for creating better lists of lists, there are a few ways to improve your second step lists.
- Persevere. You probably aren’t going to come up with THE idea on the first try.
- It’s okay to be bad. Some of my bullet points above are viable business ideas, while others aren’t (it may actually be illegal in your jurisdiction to sell abandoned pets online, though apparently you CAN sell monkey blood).
- Use Variance Technique to breakthrough idea-block and create killer lists.
Variance Technique (the shortcut to better ideas)
If I have seen further it is by standing on the shoulders of giants. — Sir Isaac Newton, the dude that discovered the Laws of Gravity
If you have trouble generating business ideas, then Variance Technique may “unstuck” you. It’s simple:
- Find a business model that is working
- Hack it.
- Cross two or more to create something new.
- Change the delivery method.
- Target a new market.
Here are examples of the Variance Technique in action:
- The Wii was gaming for non-gamers.
- My site, SaveRally, was “Groupon for students”.
- In Season 6, Episode 18 of Seinfeld, The Doorman, Kramer creates a bra for men, “the bro”.
See below for your next Action Step.
ACTION STEP – Finding Your Idea
Activity 2: Start filling in your list categories with business ideas. List 1. 10 businesses that I could launch in less than 48 hours List 2. 10 businesses I could run from home: List 3. 7 businesses that cost less than $25 to start: List 4. 15 businesses that I don’t want to d List 5-20. your lists
Narrowing Down Your Lists
If you stick to The Daily Practice, eventually you will have a pile of ideas. The next step is to trim them down. Start by removing the obvious duds – “Facebook for people that don’t like Facebook” – and then either cross off ideas or rank them. The goal is for solid ideas to rise to the top for further investigation.
Apply Filters: Scarce Resources
“Know your limit, play within it” — the Ontario Lottery and Gaming Corporation
We all face scarcity when starting our business. You may lack knowledge, time, money, or interest. Moving your business from idea to product to sales demands that you make an honest assessment of your resources. But it’s not “do I have enough knowledge to start this business?”, it’s “can I acquire enough knowledge to start this business and is it worth the effort?” Similar approach for money and interest. Time segments into two parts. “Do I have enough time on a daily basis?” and “Can I commit to this for the required period of time?” Where possible use objective measures. If you have a track record of moving on from a project after a few months, aim to start a business that fits that timeline.
Apply Filters: GOAL!
Similarly, filter each idea by whether it leads toward your end goal. Are you starting a business for the extra income? Recognition? Or as a stepping stone to something much bigger? Each of these will affect which ideas are worth pursuing.
Action Step: Trim Your List
Trim down your list of ideas before moving to the next major section – “niching down”. See below for your next Action Step to refine your lists.
ACTION STEP – Finding Your Idea
Activity 3: Start to apply filters to your ideas. Filters: Objective Measures Goal:
What is my goal in business?
Does this lead to the lifestyle I want?
How much time will I commit to this business idea?
Can I commit to this for the required period of time?
Can I acquire enough knowledge to start this business? Is it worth the effort?
Do I have enough time on a daily basis?
Do I have the technical skills to deliver a great product/service?
Idea Generation: Additional Resources
- James Altucher has given talks for Wall Street Journal, Cornell, and Mixergy.
- The Daily Practice table is based off Kevin Elliott’s adapation.
- Need some inspiration? betali.st is an endless flow of ideas.
- Find established businesses to apply Variance Technique to at the INC 5000.
- Interested in working on the Physical part of The Daily Practice? Let NerdFitness show you how.
- Need a spiritual or emotional boost? tiny buddha is one of the most welcoming communities online, and Raptitude will make you think. (but remember, don’t get distracted from your business plans)
- Kickstarter published a guide to using their service.
End Note: Idea generation isn’t the only way to start
In the magazine we go over other methods of getting started – like where you already have a mass of data, and want to analyze it for viable opportunities. But for our purposes idea generation is sufficient to get started. Going forward we will use specific examples as a case study. Let’s go with “an online store selling infinity scarves” for developing a product based business, and “legal process server – Task Rabbit style” for selling a service (notice that our service business uses Variance Technique to update an old/stale business concept). I’ll lay the examples on thick so it is easy to see how all these principles connect together.
If your ready to go further with your idea and check out the next step of Niching Down Download the Blueprint Entrepreneur app.
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Michael Alexis is the lawyer/entrepreneur for startups in Canada. A lawyer with real entrepreneurial experience — he’s started and sold an ecommerce company, worked with top entrepreneurs, and has featured content on ProBlogger and Hack The System. Visit AlexisLawyers.com to discover how Michael can help you.