Don’t be afraid to steal ideas for your start-up
AQUESTION which I am regularly asked is how entrepreneurs develop their innovative ideas for starting a business?
Whether the idea is original, borrowed, or bought, the idea is the heart of any business through all stages of its life because if there is no idea there’s no business.
Of course, an entrepreneur can come up with a number of ideas for a new business based on their skills (such as being good with your hands), hobbies (gardening) or interests (cooking). These could lead to business ideas such as craft workshops, gardening centres or even owning their own restaurant.
However, ideas are often based on experiences in the workplace and it has been estimated that 90% of all new high-potential businesses are founded in industries that are the same as, or closely related to, the one in which the entrepreneur has previous experience i.e. the majority of businesses are established in the same market as the founder’s previous business.
In some cases, a number of businesses are established with products or services that have been rejected by the entrepreneur’s previous employer. These could include an employee’s idea for a new product being turned down by his bosses and, as a result, he or she decides to take that idea somewhere else.
Larger firms can also be the catalyst for new businesses, with some ventures having been established to service the requirements of the entrepreneur’s employer, especially through the increase in outsourcing by companies. But there are also a range of other sources which can generate ideas for entrepreneurs to consider as the basis for a new business venture.
The first is other existing businesses as the vast majority of firms succeed not because they have developed something completely new to the marketplace.
Indeed, such businesses are increasingly rare and as a recent article in the Economist pointed out, new ideas are getting more expensive to find for industrial firms. Instead, entrepreneurs should attempt to examine trends in the market-place, evaluate products and services which existing businesses offer and analyse how to improve the product or service and create a new venture based on this.
Perhaps one of the most famous examples of this is when Steve Jobs, on a visit to Rank Xerox, recognised how its expensive development of a graphical interface they called a “mouse” could change his personal computer into something special. By taking this idea and refining it, he created a system that came to personify the user-friendliness of Apple and its devices.
As well as new companies, it is worth examining which markets are growing and why? One trick I teach my students about the viability of new ideas is by getting them to examine which are the most popular franchises in the USA and then examining whether a business can be developed from this market here in the UK.
It is also useful to keep up with the business press to examine whether new ideas being developed across the world can be adapted or customised for your local market.
For example, inc.com – one of the best business websites in the world – regularly reports the best business ideas every year and these can be adapted for local markets.
Another key source (and some say the most important) is the customer because any business should reflect the needs of the customer.
Therefore, trying to anticipate what customers will want in the future and whether current products or services are meeting these needs can result in new businesses, although research has shown that entrepreneurs can become attached to their own ideas and can forget to focus on the needs of potential customers.
In fact, better businesses ensure that their products are initiated by ideas from customers, rather than just from in-house brainstorming sessions or internal research and development.
Another good source of new ideas are trade shows or conferences and it is estimated that there are more than 3,000 trade shows staged annually in the UK, with some covering every conceivable product category and every industry, whilst others are more industry specific.
If the entrepreneur is interested in starting a business within a specific industry, a visit to the appropriate trade show can be an ideal forum for being exposed to new ideas. In addition, the entrepreneur can also consider the products and services of competitors while at the event as well as identifying market trends and potential opportunities.
Finally, it is not necessarily the idea that is important but the timing of that idea and many will only work when the window of opportunity has been opened for them.
For example, it is doubtful that the Body Shop would have been successful 50 years ago and much of its success during the 1990s and beyond can be attributed to the growing awareness of the importance of environmental issues among a new type of customer.
Therefore, you don’t necessarily have to think of your own unique idea to start a new business and, as the great management guru Tom Peters said, don’t be afraid to steal ideas shamelessly if you want to succeed in business.