Coming up with an exciting startup idea is difficult; and when such an idea hits you, it’s possible to be biased and overestimate its potential. At that point, it is better to gather yourself and think things through. Is your idea really worth the effort it will take to bring it to life? Should you leave that stable job yet or wait it out? Is it the right time to branch out with a “founder” designation? These questions weigh heavily on the mind of every new entrepreneur.
Thinking your idea through will not only help you get more confident, but also help convince future partners, employees, and investors about your grand vision. So, what makes for a good startup idea? Let's jump in.
A good startup idea sits at the intersection of three key areas. In each area, you - as a founder - need to ask yourself a very specific question and then look for an honest answer.
Here are the three areas and the questions that follow:
Can I create impact and wealth at a large scale?
1. Think in terms of landscapes, not necessarily ideas
Though you might be absolutely pumped about your idea, it always helps to approach it with a degree of flexibility. It is better to obsess over the opportunity landscape rather than your specific idea. Since you are going to be committed to your startup for a few years, your idea might change shape but the landscape opportunity will remain intact, for the most part.
Determining a good startup idea is first about unlocking value within the chosen landscape or market. For that, you need to do your homework on the following:
It’s better to think of your “idea” as just your initial guess at unlocking that value. You might have to course-correct and approach it differently at a later point in time - don’t get wedded to the idea but try to stay loyal to the landscape.
2. Think in terms of new approaches, not necessarily new problems
We are often obsessed with coming up with a “unique” idea. It's true that many interesting companies can be built around absolutely new ideas, but more often, companies are built around new approaches to existing problems.
So if you do believe you have a unique idea, take some time to ask yourself these questions:
You must have some compelling reasons for why this problem is relevant and solvable “now”.
More often than not, opportunity might be in having a fresh take on a pre-existing problem, by making use of a new or emerging “enabler”. You could be taking advantage of a new technology (AI), a new channel (mobile-first softwares), or a new customer base (SMBs). Spend time ensuring that this new enabler gives you a significant leg-up on the existing players on the landscape.
How excited am I about the landscape?
Building a business will consume a lot of your time and energy. So it would be wise to pick something that you can imagine yourself being excited about for an extended period of time.
Often, such drive comes from working on problems in domains you are very familiar with, or where you have directly or indirectly experienced the frustrations you are trying to address. Sometimes, this perspective comes from a family business, for example, or experiences through a prior job. Also, often, the direct domain relevance could also come from others in your founding team.
Don’t feel bad if you don't feel an intense personal connection to the problem space. But do make sure that you can remain excited and motivated by it for a long period of time.
Can I be the instrument that converts the idea into reality?
The world is filled with incredible ideas, but success boils down to how well those ideas get executed in the real world. A well-executed mediocre idea will any day outshine a poorly-implemented brilliant idea.
The “Founder” tag brings with it a lot of grind. You need to change the consumer behavior so that they accept your product/solution. You need to change the way people are used to working in order to get them aligned to your vision. Human behavior is what makes execution the hardest and the most crucial aspect of a startup's success.
As a founder, your biggest role (and challenge!) is attracting amazing talent around you. Don’t try to be the lone superhero. Spider-Man is good on his own but he’s even better with the Avengers! Your ability to convince others to join you in your journey, whether it's as a co-founder, an employee, an investor, or a customer, is your superpower.
Find an idea that sits at the intersection of opportunity, passion and execution. Don’t look for perfection - entrepreneurship requires a leap of faith. Build conviction of your own, infuse others with it, and go improve the world!