How to Ensure Your Business Idea Is Worthwhile

So, you still want to start a business. If you took my prior blog post So, You Want to be an Entrepreneur to heart, it had better be for the right reasons – for you, your team and your clients. I like to say you should be certain that the problem you seek to solve should be “worthy of you” (your time and effort) – or “how to ensure your business idea is worthwhile.”

“Did I spend today chasing mice or hunting antelope?
– Tim Ferriss (Entrepreneur, Author, Podcaster) 

You don’t run into good problems every day. Unsolved problems can be divided into a number of broad categories:

Four Types of Problems

1. Ordinary mundane problems
2. Uniquely personally meaningful problems
3. Significant problems that can’t be built around
4. Significant problems that are hard and you care about

The first two no one cares about. Building a team will be difficult and finding customers even harder. The third option is a hobby, not a business. All problems that pose simple solutions have already been solved. The fourth case is the sweet spot. That’s a business idea that is worthwhile.

“It’s hard to find a problem painful enough that someone will pay to have it solved, and yet not so painful that it’s already been solved.”
– Paul Graham (Y Combinator Co-founder)

Your ideal problem is one where there is no easy solution, its economically or socially significant (i.e., people will pay now for you solve it) and you care enough to invest your blood, sweat and tears. Solving the problem must move the need BOTH for you and you future clients.

Let’s add a bit of color to the three criteria.

Three Criteria

• Significance – Many people must care. Not care in the abstract but care urgently today – a shark bite not a muscle ache. This pain should be either widespread or deep… and hopefully both.
• Difficult – If the solution is simple either it’s already been solved, others can easily compete and/or its unlikely to maintain your interest.
• Meaningful – Simply, it must strike a deep chord with you. If you don’t care neither will your team or your clients.

How about an example of a good problem to address:

Let’s say you have a device that can remediate greenhouse gases (GHGs) efficiently and cheaply. The problem is certainly both economically and socially significant (if not existential) as well as urgent. The difficulty of the solution is evidenced by the millions of man hours being devoted to its solution and, unless you’re a climate denier, personally meaningful.

… and now a not so good one:

Remember the Segway? How it would change transportation forever?  It difficult to argue that the device addressed a pressing social or economic issue, public transit, bicycles, and FEET were already widespread. Now the underlying technology was certainly impressive but more a science project than consumer product. Finally, it’s truly unclear to me how anyone could get excited about the Segway (would you want it to be your legacy?).

You get the point – make the business problem worthwhile and worthy of you! Thoughts? Let us know of problems you’re thinking of attacking.

Arcadio (Kayo) Ramirez
Tech Team Business Consultant

A seasoned professional, Arcadio Ramirez brings over three decades of experience in working with early-stage technology business to the Michigan SBDC. An attorney by training, he provides invaluable guidance to startup enterprises on a range of crucial matters including financing, commercial operations, corporate governance and intellectual property strategies. His involvement in financial projects has overseen ventures surpassing $30M in magnitude.

Prior to joining the Michigan SBDC Arcadio was engaged in a number of entrepreneurial pursuits, successfully orchestrating the formation, funding, operation and eventual sale of two distinct companies. Notably, one of these ventures, Do It Sports, was among the pioneering transaction-based Internet platforms.

 

Join our newsletter for more information!