It’s a Good Idea, Now What?

Often in my line of work, I have conversations with people who have thought of an idea for a product or service, and are looking to turn it into a business. The first barrier they need to cross, namely, having a GOOD idea, has been crossed via validation from potential customers of the product or service. The question they have, then, is what to do next.

The first thing that needs to be realized is that getting validation that the idea is a good one has ramifications for how to proceed. Some potential clients can help by working with you to refine the service or product. Other times, you have to go off on your own and figure it out.

One of the biggest mistakes someone new to the business world can do is to go out and try to raise capital. The reason is quite simple – you don’t know yet if you actually need any. Sure, it would be nice to have a budget of millions that you can spend on fancy offices and a huge staff, but do you NEED it?

The first approach, therefore, should be to determine how much of the product or service can be developed with what you have – namely, yourself (and any partners you may be working with). Commonly known as bootstrapping, you should be trying to build out with the minimum amount of resources possible.

If that’s not possible, see what you can get by reaching out to your network. People don’t expect to work for free, but you may be able to barter something of value (and note that shares in your business currently have little value at all) for work.

Don’t forget that you need to be thinking about multiple aspects to your business. You need more than just an idea, product or service – you need to be able to sell it. If there are legal ramifications to that, make sure you work them out up front. You may need a marketing plan, you might need to work out pricing schemes. If you know someone who’s been in business, talk to them – you should try to get a mentor if you can, if only to steer you clear of issues that you might not need to face.

However, start your approach with an eye toward frugality. That doesn’t mean trying to pay less than the value of a given item, but rather determining if you need the item in the first place. There’s a gray area between good enough and perfect, and usually, perfect isn’t worth the effort over good enough (though of course there are many exceptions to this).