All great businesses start from nothing but a spark of inspiration. From tech titans to media empires and every small business in between, we glorify the entrepreneurs who had the ability to generate ideas out of thin air and pursue them to achieve incredible outcomes.
But if you’re still in the early stages of building a business, an initial obstacle is figuring out if an idea is worth pursuing from the get-go. Aside from your own imagination and vision of the future, how can you really determine if your idea will pan out successfully?
It’s a legit question, and an important one to address sooner than later. That’s why we asked a dozen business leaders about their own experience starting companies and how they knew an idea was worthy of their time, effort, and energy.
These insights may just save you a lot of resources and point you in the right direction for your business goals, so make sure you don’t miss a beat.
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Passion, Mission, and What Matters to You
There is one key ingredient that drives every business forward, whether or not the core idea appears to be viable or valuable. A passion for the project needs to be there from the start, otherwise, the company won’t make it far.
“When someone runs a business idea by me, I always try to gauge whether they seem to care about the underlying mission, or if they’re just looking for a way to cash out. Far too often, people are eager to jump into areas of business that they barely understand and don’t have a personal connection with the industry. These companies always fail because the founders aren’t in it for the right reasons.” – Soumya Mohan, COO and Co-Founder, Poised
Of course, it’s totally feasible for someone to switch careers and pursue a new mission in life, but this will take more time, patience, and a tolerance for a learning curve that might be steeper than expected.
“Some business ideas are duds, and others are instant hits, but in most cases, the x-factor is really the amount of energy and effort that founders are willing to put into the project from the start. This could mean making a huge career pivot and rebuilding a skillset from scratch, or it could mean applying the knowledge acquired over the course of a 20-year career to hit the ground running. Persistence and a willingness to stick with a company for years are often what it takes to rise above the rest, from what I’ve seen.” – Nick King, CEO, Vint
Market Research Done the Right Way
The value of market research can’t be overstated when starting a business, or even formulating ideas for one.
Smart business leaders take a systematic approach to market research so that they can get all the facts with none of the fluff.
“Most market research is intuitive, but you need to treat it like a true project and legitimate step towards building a business. It starts with identifying the main competitors in your space, getting an idea of the market size, determining the cost of overhead and production, and mapping out the obstacles that companies face in the industry. The more data you accumulate about your market, the clearer the image of your brand will become, and you can assess from there whether the idea is worth taking any further.” – Ryan Rottman, Co-Founder and CEO, OSDB
Sometimes less is more when it comes to market research, however. Entrepreneurs warn that too much research can cost you too much time and money when you should just be getting to work.
“The amount of free information available for market research is astonishing, so don’t burn cash acquiring data that’s already out there. Also, avoid sinking endless hours into the market research process if you already have the key pieces of information in hand. At a certain point, you’re just spinning your wheels and not making significant progress. Time is your most valuable asset in business and life in general, so dedicate a solid chunk of time to market research and then decide if the business is viable or not. It shouldn’t take weeks or months of deliberation.” – Tyler Read, Founder and Senior Editor, Personal Trainer Pioneer
Connect with Customers (and Listen)
You’ve probably noticed that customers are quite vocal when it comes to sharing opinions of all sorts on social media. Everyone has a hot take about media, politics, and brands in every industry, so listen up and see what people are saying about your area of interest.
“Social media has become highly personalized and is a great place to interface with customers about a business idea, or even launch a brand concept to get some initial feedback. You don’t need to put a ton of money down. Just make a few social media pages for your brand, maybe with some concept designs or copy, then see how people respond online. If it looks professional and resonates with folks on social media, you may have something worth pursuing. If you fail to generate any buzz and fall flat, it’s likely time to move onto the next idea.” – Maria Shriver, Co-Founder, MOSH
Customer connections can go beyond social media, as well. Set up a basic website with an email newsletter, and use this as a starting point to build an audience. As you develop ideas and float them out to the public, your best business ideas will start to take form.
“You can’t launch a business and wait for customers to show up like trick-or-treaters on Halloween,” said Aytekin Tank, Founder and CEO of JotForm. They need a reason to care; something that’s unique, intriguing, fresh or surprising. Our company used drag-and-drop technology before it was a thing. That was our angle, and I applied it to pitch news sites, write blog posts and develop PR plans. Consider what people care about most, and emphasize how your startup supports their busy lives.”
Envision Growth and Development
While all companies start as a small kernel of inspiration, there must be a path towards expansion so that the business will remain relevant and thrive.
“Most business owners want their business to grow, and often growth includes consideration of new products or services,” said Arlene Soto, Director of Product and Customer Experience at Watergen. “Sometimes, though, brainstorming new possibilities interferes with maintaining the core business by distracting the owner from focusing on the issues confronting them. To allow room for new ideas without distraction, it helps to have a system for handling them.”
Don’t just think of a single product or offering – shoot for the moon and plan to build an empire.
“It’s often better to think big and then execute on a smaller, more manageable level one piece at a time. That way, you always have something to pivot towards, and you never run out of ideas when the pressure is on. Even if your business starts with just one or two offerings, you can quickly shift gears when momentum builds and take things to the next level.” – Katy Carrigan, Chief Revenue Officer, Goody
Map Out a Financial Strategy
It’s the least exciting part of starting a business, but an essential part of the checklist. Is your company going to be financially viable, and how do you plan to fund it early on?
“The reality is that nobody knows for sure whether a business will make money, what the profit potential could be, and how long it will take to get out of the red. The best we can do is make estimates with loose figures and just try to generate as much capital as possible. The more you try to squeeze everything into a strict financial model, the less success you’ll find.” – Cody Candee, Founder and CEO, Bounce
At minimum, business founders should get a clear picture of costs and how much money they’ll need to get started. In the meantime, it’s smart to keep some other streams of income flowing.
“A simple spreadsheet can serve as your bookkeeping strategy in the early phases, although there will definitely be some unforeseen expenses along the way. Consider applying for small business loans or taking out a new line of credit under your name if you’re serious about pursuing the idea. This is a good way to figure out whether you actually want to start a business or not. Putting money down will either motivate you or scare you away!” – Phillip Akhzar, CEO, Arka
Put the Plan into Action ASAP
At a certain point, you should just dive in and pursue your dreams. Nobody else is going to do it for you.
“Here’s what nobody wants you to know: it has never been easier to start a business, and the cost of entry is lower than you think. In fact, there was a record number of online businesses started last year, so you are all out of excuses.” – Shawn Munoz, Manager, Pure Relief
If you need a bit more pressure to get in gear, recruit some friends and make it a team effort.
“Teammates are great motivators if you choose the right people. Build a team of individuals you trust and can get along with, not necessarily the smartest or most skilled. They can learn stuff along the way. What matters more is the team dynamic and sticking to the plan.” – Yooseok Gong, Global Business Lead, Ohora
Starting a business isn’t easy, but it’s far from impossible. Even if your current idea doesn’t pan out, stay focused on your broader mission and continue to take those calculated risks.