“Mo problems, Mo money!” – an Entrepreneur
If you were to attempt to define entrepreneurship in two words it would quite simply be: Solve Problems. That’s what entrepreneurship is about. Solving problems. The more problems you can identify the better.
The good news is that there is never a shortage of problems to solve, you just have to know how to identify them.
In an earlier post, we talked about 4 ways that you can identify new business ideas. The major theme for each of those 4 methods, is active problem-solving.
A common problem I see amongst new entrepreneurs is the tendency to create solutions for problems that either do not exist or that are too small to effectively grow into a real income-producing business.
You might think you have a great new business idea, but how much time have you put into researching this idea to make sure that it solves a real problem for real people?
Very few do.
Here are a few questions you should always ask when pondering a new idea.
- Are there people that are suffering from this problem that want a solution?
- Are they willing to pay for this solution?
- How much are they willing to pay for this solution?
- How are your potential competitor’s fairing? Can you improve upon their business model and provide more value to the marketplace?
If you can answer these questions favorably, then your idea might be a great opportunity worth pursuing, else you run the risk of wasting precious time and money.
Sidenote: Your problem does not have to be something that is brand new to the marketplace. This is another common mistake new entrepreneurs make when getting started. They think that they have to create something brand new. You don’t!
You can easily take an existing solution to a problem and make it better by improving upon it or by catering the solution to a different subset of people. I’ll touch on this a bit more in a new post as I believe it is worth going in-depth about.
Let’s dive into how you can find problems that you can turn into a real business.
What is the need and can you fill that need?
First things first, I want you to list out problems that you have noticed. We are going to evaluate based on these.
So you’ve found a few problems and you are ready to dive in and solve them. Great! However, you should always take a step back and evaluate the problems, its value to the marketplace, and if your abilities align with the potential solutions.
Creating a new business takes equal parts discipline and equal parts passion. If you are not excited about the problem, you are far less likely to weather the storm and challenges that you will incur while creating and marketing the solution.
Look at your problems and ask yourself. Is this something I can get excited about? Do people really need a solution? Make a note next to each one.
You may have an idea to create a new vitamin for business professionals that are on the go. In your head, it may sound like a great idea. However, how excited are you to likely be researching and formulating this new product? It will take time to bring something like this to the market. You’ll need real interest to keep yourself motivated enough to see it through.
Is there a large enough market that would be interested in this product? We can’t make things up, we need real verifiable data to prove this.
Do I have the knowledge or am I interested enough to gain the knowledge needed to be successful with this idea?
If we can answer yes to these questions then it might be worth moving forward.
Define the problem.
Now that you’ve answered the initial questions and have decided that you are passionate about these problems and that there is an actual need in the marketplace that you have the capability of solving, its time to get specific.
How big is the problem?
If you are just starting out it is okay to start with small problems to get some experience under your belt. If this isn’t your first rodeo you should definitely be looking to aim bigger.
Identify the problem that you passionately want to solve, that aligns with your skillset and interest, that also has a potential market for you to sell the solution to.
After all, is there is no one willing to pay for the solution, you are doing charity work, not business.
Know your competition.
Once you’ve identified a favorite from your list of problems you will want to evaluate the current solutions available to the market. There is a good chance someone has tried or is currently solving the problem that you have selected.
This is not a bad thing. In fact, it is good. This means that there is demand!
Lookup companies that have either failed at solving this problem or companies that are potentially under solving them.
Look at what they may be doing wrong. Are their prices too high for what the market is willing to pay? Are they leaving a subset of the market untapped? I.e think about shampoo. You have generic shampoo and you have shampoo for pets, shampoo for people with specific skin needs. Use this as a guiding thought when answering.
How is their product presentation?
Can you improve the sales process?
Can you provide better and/or longer support?
If you can, this means you can compete!
When starting a new business you want to find ways that you can be a leader in the marketplace and really dominate. Answering the above questions will help you do so.
Wrap it up and put a bow on it.
Now that you have identified a problem that:
- You are passionate about.
- Meets your specific skillset or a skillset you are interested in acquiring.
- Is in demand and people are willing to pay for.
- You can actively improve upon.
You are ready to create your story and bring it to the market. You want to be able to clearly describe your problem, the solution, and why you are passionate about solving it.
In short, you want to create something like an elevator pitch that you can use to pitch to potential partners, investors, and even customers.
This story will be what keeps you going when you hit rough waters.
Now that you have answered the tough questions relating to your new idea, you literally have everything you need to take action and get started.
Very few entrepreneurs ask themselves these questions before launching a new business, the very fact that you have already puts you ahead of the game!
Now it’s time to move!