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4 Tips on how to succeed in turning your business idea into a viable business.

Turning your idea into a viable business is a very rewarding journey if done correctly.

Author: Kynthia Melissa
Date: May 28, 2011 - 8:13:11 AM

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The journey from idea to viable business is most often complex frustrating and sometimes rewarding. Understanding some of the pitfalls before you set out should make the path a little smoother

Tip 1 – Setting your idea free

Contrary to popular belief, business ideas are not valuable. Great business ideas are everywhere, but most every great business ideas never become a great business. The journey from idea to business is often longer and more difficult than founders anticipate. A fundamental assumption that most founders have is that everyone is looking to steal your idea. The reality is quite different. People are busy and unlikely to have the conviction in the concept that you do. Whilst it is natural to want to try and protect your idea, often doing the exact opposite brings the new insight required to make it a reality. A business idea is usually just that and requires a substantial level of input from a wide range of sources to turn it into something of value.

The more feedback you can gain in the early stages, the more time and effort you are likely to save in taking that concept to market. If you can, test your assumptions early. It is often your assumptions about the idea that are wrong. Identify the assumptions you have made that are fundamental to the business success of your concept. Test these assumptions.

Identifying the customer problem is at the core of successfully translating an idea into an enterprise. An inherent difficulty of this process is that it is difficult for an “outsider” to clearly understand the exact customer problem.

As an example of this, I was recently advising a new start-up venture that thought the problem they were solving with their business idea was to fill seats for events. Their business model meant that they took a commission on all seats sold via their platform. Whilst on the surface, this sounds logical, when you dig a little deeper; there are substantial issues with this assumption. The existing players already sell the majority of seats required. Engaging with a third party makes sense for clearing unsold seats, but not for selling all seats, as this will eat into overall margins for the event.

When you think you have identified the customer problem, try to validate it with a potential customer to ensure you have the right positioning.

Tip 2 – A start-up is not a business

There is an old saying that if you give the same idea to 10 different entrepreneurs, they would each commercialise the concept in an entirely different way. Particularly in the early stages, the best you can hope for is a foray into a number of different entrepreneurial endeavours around your idea.

As an example, in the launching of our new business planning toolkit, we undertook a number of entrepreneurial endeavours to determine which of these might become a viable business. These included: Google Adwords, Display Advertising Online, Magazine Advertising, Public Relations, distribution via accounting firms. Until you have identified which of your channels to market can provide a consistent formula for business success (Revenues Exceed Costs), you do not actually have a business.

In business start-up phase you are undertaking a journey to find the business in your idea.

Tip 3 – Iterate Iterate Iterate

Build iteration of your business model and channels to market into your business plan. Don’t put all your eggs into one basket. Whilst you might assume that a single marketing method will deliver results, don’t put all your funds behind that faith. Keep some funds in reserve for iteration. By iteration I mean the ability to try many and varied approaches. This may involve trying different channels to market, different marketing methods, different product positioning and even changes to the product or service itself.

Tip 4 – The best product doesn’t always win

Simply having the “best product” isn’t enough. People don’t like change. Lets assume for a minute that you invented a better type of aircraft. How long do you think this might take to get to market? Will you have the funds to cross the compliance issues associated with the innovation. Even if you make it past these hurdles, will customers switch? If you require changes to airport infrastructure, landing strips or customer boarding processes, you might find you are in for a very difficult journey.

Don’t assume that just because you have a “better product’ that you will be successful. There is a substantial amount of supporting physical and intellectual capital that goes into making a product or service successful from a business perspective.

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View all articles by Kynthia Melissa

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