500+ Startup Ideas. How to Solve the Right Problem?
Should people struggle to find the right startup idea? No! Here is a list of practices to find a worthy business idea.
If you think that startups ideas are hard to find, you couldn’t be more wrong. In fact, those should be easy to spot because there are so many real problems out in the world! But don’t worry if you experience hardships finding them. Perhaps, you just need some help on how to notice unique business ideas and the most profitable businesses.
So why struggling? In this article, we are going to share key ways on how to find the right start-up idea by relying on industry heavyweights.
Major steps for your startup research
There is a common mistake that one needs an amazing idea to get started. You might imagine a group of founders sitting in a living room and generating a list of crazy ideas for a new start up companies until a brilliant one comes to their mind. In hindsight, successful companies like Google or Facebook all look like amazing ideas. In reality, Google was probably the 20th search engine when it launched. The same applies to Facebook which wasn’t even the 5th social network. What made them successful, however, was a good enough initial idea, combined with great execution. By the way, execution and marketing are the key challenges for start-ups.
YCombinator video on Startup Ideas by Jared Friedman
So choose any of these steps. They may work in isolation but increase your chances for success when combined.
Step 1: Founder/market fit.
In our Founder Manual, we mention the importance of problem/solution fit and product/market fit for start-ups. When you are still at the stage of brainstorming, let’s say, most profitable small businesses, generate all the ideas that have a good founder/market fit. Those are the ones that would give your team an unfair advantage when executing.
Step 2: What you wish for.
As any entrepreneurs startups will tell you, think of problems you have yourself. The things you wish someone else could build for you are also a good start for great startup ideas. A notable example is DoorDash. When their founders tried to order Thai food in the suburbs regularly, they realized there was no delivery service for that. It is why DoorDash launched.
Step 3: Your passion.
There is an exercise called “Future Backwards.” You simply imagine an ideal picture and start building from there till today. Without much accuracy, but it assists you with filling the missing gaps when building an industry-shifting product. Founder at YCombinator, Paul Graham, famously said:
“Live in the future and build what’s missing”
It can be useful for ideas, too. Ask yourself whether you’d be excited to work in this particular industry on this specific problem in 10 years from now? Even if it isn’t successful?
Step 4: Global shifts.
Another way to notice startup opportunities is to observe the recent changes. Jared Friedman tells a bright example of PlanGrid, acquired later for a billion dollars. PlanGrid allowed construction blueprints on tablets while replacing traditional sheets of paper. Interestingly, it was possible to take off once Apple released the iPad.
Note what is happening in the world. Perhaps, the broader acceptance of cryptocurrency or smartphones with AR capabilities can unlock the potential for your idea.
Step 5: Variants of recent hits.
A safe bet is to find companies that have been blooming recently and try to find new variations of them. When Amazon announced Amazon Go, Standard Cognition realized that every retail store would eventually incorporate the same technology. It is a grocery store concept to automatically track product one takes off the shelves making cashiers unnecessary. And that’s what Standard Cognition does.
Although it is a typical practice to search for ideas of fast growing tech startups, it’s obviously not the best one. Often, ideas that are generated using the “Uber for X” approach a “solution in search of a problem” or SISP for short. It is common that this search becomes unsuccessful and a startup development company fails. Therefore, be skeptical by default when leveraging this step.
Startupsafari.com was an example of how to find new businesses in my area
Step 6: Broken industries.
When looking for the best industries to start a business, find a field that urges for change but nobody was able to provide a sufficient solution. The best entrepreneur is open when ideas come to his mind but he or she constantly searches for challenging the status quo. Fintech is hard and was unreachable for years until Stripe approached each hard question with diligence (like legal and technical points). Now it’s an industry standard for payment settlement in the US.
Step 7: Crowdsource new ideas.
Crowdsourcing ideas means using the power of many people (their feedback) to spot a potential worthy idea. A high-profile case of this is LendUp company which attempts to replace payday lending. It started when LendUp founders noticed this industry was clearly broken and scammy.
The con of this approach, however, is that it will often lead to poor founder/market fit. One simply cannot know everything about the targeted industry to disrupt it. On the other hand, if you are already an expert, this is an ideal combination with step 1.
How to gather ideas for startup business development? That’s what we are going to talk about next.
Study pain points
The last two steps lead us to some exploration. It is neither difficult nor time-consuming. However, the benefits are underestimated. In 2012, Chris Guillebeau published The $100 Startup; in this book, he talks about travelling to 175 countries and own observations of local entrepreneurs (50 people out of over 1500 are featured in this work). It is a guide based on 2 years of meeting business people and watching how ideas come to them organically.
Talk to potential customers
To understand your prospective customers and test hypotheses, there is no need to become a backpacker or fly around the world. Instead, visit forums and LinkedIn/Facebook groups for each of the industries you are about to test. Here is how you can verify your business concept and promote the product among first users.
Screen comments and rankings
Another powerful technique is screening the Play Market and AppStore for potential. All those negative comments can become your source for inspiration (and better solutions). Sense what people don’t like and really want. Set your KPI to achieving that; you’ll need a prototype only. This will help create an MVP later.
Come up with a radical new solution
Let’s talk about innovation (prioritization) matrices.
Small business ideas for women
Imagine a spectrum where on one end it says “try anything that comes to mind first,” and on the other: “wait until the perfect idea comes.” You want to aim somewhere in the middle. Don’t worry if it doesn’t seem as exciting and bold as Amazon’s everything store. In the beginning, it was simply an online bookstore. Similarly, Airbnb was just a website for renting air beds at other people’s houses. It transformed into all vacation rentals over time.
Startup ideas, even cheap small business ideas, morph over time. But how to evaluate the initial idea?
That’s where the idea matrix comes in handy. The three most critical questions are:
- How big is your idea (market)?
- Do you have enough expertise (founder/market fit)?
- Is it a big enough problem (are people willing to pay for it)?
We’ve made a copy of the Problemeter tool to assist you with this task.
Filters to deploy or avoid
While you are doing this, a temptation to avoid certain ideas will eventually appear. The trick is to spot those filters being both sceptical and objective. For instance, there is a phenomenon which is known as Schlep Blindness. It translates as “the problem is too hard for me.” When a lot of entrepreneurs capitulate before a certain industry, it remains unchanged for years (like legal services or finance).
Another bad reason (that you need to avoid) to reject a startup idea is thinking that a problem is either too boring or too ambitious. Lots of successful businessmen approached a specific problem for large businesses. The solution didn’t change the world nor was it exciting, but it surely did save customers money.
Competitors form the last filter that might signal you the idea is not worth pursuing. It is not true. You should be encouraged to do your own research to understand what market share each competitor possesses, what needs they serve, and why some of them appear to be weak competitors.
YouNoodle.com platform helps startup founders enter different competitions
Compare yourself to competitors using these platforms and listings:
BMC: unique value proposition.
Eventually, a founder would come to formulate his or her own unique value proposition. A proven tool for doing this is a Business Model Canvas or BMC for short.
Wrap up: What’s ahead
What’s your problem that you are ready to pay for solving it? Find out with our help during the Discovery Phase. As Graham rephrased his own quote “into something even better”:
Live in the future and build what seems interesting.
Read more – how we implemented startup idea into project Mentor.Me