David Travers is a partner at Rustic Canyon (http://www.rusticcanyon.com/). In this video he discusses how to settle on an idea for your new company.
- Choose something that you're truly passionate about.
- Identify your first customers
- Size up the market
One of the questions I get asked most often is how to choose an idea for a new company by an entrepreneur. There are a few things that can really help in that process.
One is make sure you tap into a passion. Starting a company is an incredibly brutal and taxing process. When you’re going through the tough times, the only thing that’s going to get you through is your passion for what you’re doing. So understand what it is about yourself that is going to keep you going through the hardest times and what you’re passionate about and choose an idea that taps into that. That will allow you to succeed and other people will feed off of your passion.
Secondly, identify your first customers. It’s one thing to identify an idea for a company in general, but what provides discipline to an idea is identifying a real first customer who says, if you build me this specifically or you provide this product in a very tangible way, I would buy that and I would buy a lot of that. That would discipline and focus your thinking in a substantial and meaningful way.
And finally, make sure that you’re going after an idea that has a big potential market. If you are going after something where only one company in the world wants to buy your product, you’re really limiting yourself and you have a very risky model where if your one customer doesn’t want to buy from you, you’re in real trouble. What you want to do is go after substantial market where the rewards for all the toil you’re going to put into your entrepreneurial endeavor are really going to be rewarded.
If you follow those guidelines, I think you’ll pick a great idea.