How to Come Up With a Profitable Business Idea in 4 Simple Steps
Most people get really anxious when it’s time to start developing ideas for their business.
Lots of people love the idea of brainstorming ideas…but can never actually find an idea that they like enough to execute. I’m not sure if there’s some weird internal test that gets run in our heads that makes us believe an idea isn’t “good enough” — but for whatever reason, it seems like there are two huge problems when it comes to developing an idea:
- We don’t think we have any good ideas, so there’s nothing we can possibly see succeeding. This is the guy who’s always telling you about a new project he wants to start, then you find out two weeks later he’s already abandoned it.
- We think we have too many good ideas, and we are completely confused as to which one we should run with long term. This is the guy who always has 12 projects brewing at the same time, all in various stages of progress, none really doing well.
While these seem to be opposing concepts, they often ensnare us in the same dilemma: half-starting and eventually quitting. So where should you be focusing your time and energy? How do you know if your idea is good enough to “make it.”
First, remember something crucial: All businesses — services or products, online or offline — are a direct response to a problem. The purpose of a business….the only reason it exists, in fact, is to solve a problem. You should be actively thinking of how you can solve other people’s problems. On a day-to-day basis, you should be thinking about thing you and others around you struggle with…then find ways to solve those headaches through an idea, device, service or piece of software.
Better yet, start pretending you’re Olivia Pope and become relentless in your approach to problem solving and “fixing” things.
Coming up with fresh business ideas shouldn’t be something that you just do once a year when you need some money. If you want to be an entrepreneur, you must fundamentally change the way you look at the world, always seeking out opportunities to serve other people and get paid in return. With this in mind, your well of creative inspiration will never run dry. There are four places I look when I want to come up with a new business idea quickly:
1. Hobbies and skills you’re already good at.
Everybody has SOMETHING that they’re good at. The problem is, most of us take our skills for granted. We don’t appreciate the fact that the knowledge and abilities we have at our disposal could be very valuable to someone else.
- Maybe you’re bilingual, or you can play an instrument.
- Perhaps you know how to organize the HELL out of a closet.
- Maybe you’re really good at cooking…or building websites.
- You might have even successfully completed a few triathlons.
All of those are things that other people want to be able do for themselves, but in many cases, can’t. If you’ve spent considerable time learning to do something — either in school, as an apprentice, as a hobby or even as a recreational activity — that time has immense value. Rather than learning to do what you’ve done or putting in months (or years) of work grinding away, many people will be more than happy to pay you in order to get what they want much more quickly.
You can teach someone else how to do that. Or if you don’t want to teach it, you can simply use that skill to provide a service and do the work for them.
2. Things you’ve done for work.
SPOILER ALERT: “Learned at work” skills are a great place to look when fishing for your first profitable business idea. If you’ve ever held a job, that’s proof you have at least one skill or idea that somebody is willing to pay money for!
Like most people, you may be under the assumption that your hourly wage/salary reflects the actual value of your skills — but here’s the thing: there is no “actual” or innate value of a skill, service or idea.
Washing dishes could be a $7/hour skill…or a $15/hour skill depending on whose plates you’re cleaning.
Building a mobile app for your employer could be one of the hundreds of other things you do every year as part of your $60,000 salary.
Your salary doesn’t reflect true value, it just reflects your employer’s estimation of how much they can afford to pay you after they’ve accounted for all their expenses + made a healthy profit.
If you have a boss, you’re not making as much money as you could be for your time. Period.
Here’s a partial list of all the things taking money out of your paycheck before you even see it:
- Recruiting costs — the employer has to find you and get your attention. This happens online, at career events or by putting a sign in the window. Every position needs to be filled — all the way to high level recruitment for senior positions. Costly, to say the least.
- Training — it costs money for the materials you’ll need to get started. Things like computers, software, uniforms, desks, stupid potted plants, and that ergonomic mouse pad that you didn’t ask for with the weird hump by the wrist hump. All that’s coming out of your salary. You’re welcome!
- Health insurance — If you’re full time (40 hrs), insurance is costing you, and it’s probably more expensive from your employer than it would be to purchase your own.
- Financial programs — some companies offer 401K matching programs, stock options and other financial incentives, which are great. But will also cut into your salary in many cases.
- Overhead — this includes any physical office space and all the utilities and other recurring costs that come with the building the employer occupies.
Management and executive salaries — yeah…often quite disproportionate.
By the time your salary is up for discussion, it’s less about what you’re worth and more what they can afford. In some cases, someone working a job that deserves $100,000 is getting $50,000 or less!
The skills you acquire along your journey are yours to use as you wish, at a price that you command.
Now, your job is just to identify which of your on-the-job skills is ripe for the picking, start developing your idea and then find your customers.
3. Things people ask you for.
Besides the seemingly interminable amount of time spent in school, I think one of the biggest turn offs about a career in medicine would be the relentless questions from well-intentioned civilians looking to “pick my brain” about a medical problem they were having.
“Do you have a quick second…I wanted to get your opinion on something.
[DOESN’T WAIT FOR PERMISSION]
I’ve been having this weird pain in my chest. It’s a bit like indigestion…but it’s a little bit sharper. I usually always get it after I eat spicy foods. Any idea what that could be?
[DOESN’T WAIT FOR RESPONSE]
Yeah, because I checked on WebMD and they said I should get checked for polyps on my spleen if it doesn’t subside in about a week or so. What should I do for polyps?”
On and on these questions would go. But I guess that’s how it goes with many professions, right? If you have a friend who is an attorney, you might find yourself shooting him a text that says something like, “Can you go to jail for unpaid parking tickets…hypothetically?”
Point here is that whether you realize it or not, we lean on experts to help us figure things out, and if people keep asking you for help, advice or insight in a particular area, there’s a good chance that others look at you as the expert or “go-to” in their circle of influence.
You have to start paying more attention to things that people ask you for. If someone asks you to help them with something, your mind should immediately begin assessing whether this is something that could become profitable.
Do you have friends who are always asking you for diet advice? What about people who are constantly asking your your insight about their relationships? Maybe friends and family call you to watch their dogs when they go out of town.
Start paying attention to the things that people require of you, then eventually, you’ll get paid to do things that you used to do for free.
4. Things you want to learn.
After teaching college test prep for a while, my second successful freelance business that I quickly scaled to over $100k was a web design company called Primal Digital. Guess what? I barely knew anything about web design in the beginning!
The idea started on a whim. I’d already had a bit of success with my first business as an SAT tutor, and I was looking for something that I could do from my house. I was not an expert by any means. I knew just enough to get a basic one-page site up on WordPress and that was about it. It’s almost embarrassing to think about as I type it now.
I set up my web design company’s one-page website with a very fancy theme to give the appearance that I was much more established than I actually was…and proceeded to start posting on popular freelance job boards like Upwork (Elance/oDesk at the time) and a few others.
Within a few hours, I started getting bites for $1,000, $2,000, even $5,000 jobs!
How was I able to get away with this?
My first few clients were happy to pay me because even though I wasn’t a world class expert, I still knew more than they did about building a website. Remember, for someone who doesn’t use computers much outside of Google and Facebook, even setting up a basic WordPress blog is a damn near mystical process. I worked my way up doing simple work, and as my skill set improved, I was able to charge more and more for my services. I essentially paid myself to learn how to build websites.
You could do the same thing easily.
Find a skill or idea that you’re a beginner in…but that you want to become really good at. Then gradually improve that skill set and find customers who are willing to pay you as you learn. It’s like paying yourself to go to school for something that you actually care about.
You don’t have to start as an expert. It’s ok if you haven’t done this before. You’ll get better with time — and you can get paid in the process.
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