Good Startup Business Ideas

Business, Entrepreneurs, Featured, Incubators

What Are Good Startup Business Ideas

Budding entrepreneurs are always looking for what could be good startup business ideas. In this post, we are going to look at how the systems of ideation used can make or break the performance and success of a startup.

Many startups put all their focus into supply-driven ideation. With the goal of producing as many good ideas as possible. There is a clear fault with this approach that often leads to startup fails. It’s no wonder over 90% of startups aren’t successful.

However, when the process of ideation is collaborative and demand-driven, we tend to see more successful startups that perform better.

 

Why is Finding Good Startup Business Ideas So Troublesome?

One of the most common causes of startup failure is producing an idea with no market need.

It’s common for many aspiring entrepreneurs to bounce their ideas off family and friends but they will typically agree that it’s a great idea, because they want to be supportive and positive.

Although a valuable part of the ideation process, there is a problem with turning to loved ones; Are they the target customer for your idea? Would they be prepared to buy it themselves?

It’s easy to see how an idea may be useful for someone else, but the true test is seeing if you yourself would pay for it.

So, who should we be talking to?

 

The First Step to a Successful Startup Idea

Look at the market needs!

For successful companies, there need to be people willing to pay to use your product or service.

Let’s turn to Dragons Den for an easy example which demonstrates this. A few years ago two friends pitched their idea, ‘Look after my Bills’. Their model involves switching customers automatically (and for FREE) to the cheapest energy suppliers on the market, saving consumers hundreds of pounds a year.

After their pitch, they received an investment of £120,000 for just 3% of the company, probably the best deal ever in the history of the show. Since then, the company has grown to over 400,000 members and was bought out by popular comparison site GoCompare in the summer of 2019.

But the success of co-founders Will Hodson and Henry De Zoete didn’t come down to the luck of having a great idea that stuck.

Years of battling the energy industry on the unfairness of energy prices (even making it to the news), resulting in the duo discovering a real NEED in the market for fair energy prices for consumers.

You can read about their success story here. 

This small example demonstrates that there was a real desire in the market to pay cheaper energy bills. Who could argue with that?!

By working with a demand-driven idea, the company has seen an incredible success that many startups desire.

 

Demand-Driven Ideas

Decades of supply-driven ideation, manufacturing, marketing and sales have led to an ingrained attitude in the business world towards how business and customer relationships work. However, with demand-driven processes, companies are changing the way they operate by understanding first what the market wants and determining how it will meet that demand.

There can be lots to learn from a demand-driven approach (DDA) to running a startup. There are many global initiatives that are promoting demand-driven approaches as supply-led initiatives are feeling outdated and even backwards in the business world. This is being initiated throughout all levels of organisations, not just for startup ideas.

Successful entrepreneurs are understanding the true value in operating a business model around a demand-driven approach. Companies who are adopting their strategies to fit around the wants and needs of their customers are saving on costs, errors and time.

But how can you successfully generate a demand-driven idea?

The challenge of this ideation approach is finding an already willing customer looking for a solution to their existing problem.

 

How to Generate Demand-Driven Ideas

People buy products for two reasons;

  1. To solve a problem, aka: eating food to satisfy hunger
  2. To enhance something they are already doing, aka: eating a dessert

People will usually pay more for problem-solving, hence why demand-driven ideation is more successful.

 

How to Find Demand-Driven Ideas

It couldn’t be simpler, just ask. 

Before you build your startup, either pick an industry you are familiar with (or someone who is) and ask them about their problems. What will make daily life easier? What things they wish they had etc.

This highlights the challenges that this industry faces and clear solutions can be identified to solve these issues.

However, the difference between a good idea and a business is the fact that people are buying it. 

Anyone can give you advice on what they would like but ask them the real questions.

How much would they pay for this solution? Would they actually use it? This makes them think more seriously about your questions and give honest answers.

 

Securing Your Position

If you’re offering a very real and practical solution to someone’s problems the relationship between you both is win-win. There is no party having the advantage in this scenario so it would be sensible to protect yourself.

Arrange a pre-agreement on buying your product before you go ahead and put all the effort into beginning your startup. Otherwise there will be a significant amount of time and money spent on a pointless endeavour if they refuse to buy the product at the end.

 

Apply the Demand-Driven Approach to all facets of your Business

The demand-driven model doesn’t just stop with the idea. It needs to be extended to the whole life cycle of the business to ensure you’ll always be successful.

Therefore, you need to build what your customers actually want, not what you think they want.

Don’t be afraid to evolve the product and change ideas based on customer feedback.  The more feedback you get, the better your product. Flexibility is key to enabling a demand-driven model to work.

 

Personas

This is where creating a buyer’s persona is essential.

Every business building decision needs to be around your customer persona.

Whether this is a real person or a fake persona their needs and wants need to be central to every decision made.

We have written extensive posts on creating persona’s here.

 

The Alacrity Foundation Programme

 

Utilising a demand-driven ideation strategy is the graduate startup programme The Alacrity Foundation. Every year they receive an abundance of good startup business ideas from industry experts who are keen to share real-world problems.

Alacrity is a unique educational programme that equips graduates with the right tools and skills to launch their own profitable UK technology start-up. The ideas for each startup created are sourced directly from the industry.

Problems are found across a wide range of industries including health, financial services, technology, education, security the graduates can find and provide practical solutions.

So if you’re looking for good startup business ideas and want to become an entrepreneur, maybe your best chances are joining the Alacrity Foundation.

 

More information:

Supported by The Welsh Government, Wesley Clover and the Waterloo Foundation, Alacrity is a charity that focuses on creating hi-tech companies in Wales.

Many of the companies graduating from the programme are created around a customer need, and therefore will often have a paying customer when the company accepts investment. Fast-tracking them to success.

Graduates are paid a stipend (tax-free) of £1,500 a month during the programme. The programme works on a practical learning approach that supplies graduates with transferable skills into the real world- without the support of mentors.

 

The Mentors

Alacrity is part of a large network in the technology industry. The programme relies on the expert advice, experience and knowledge of over 70 mentors from a range of businesses.

 

The Companies

Once the 15-month programme is over, the graduates will be able to propose their business plan to a team of investors who give each company up to £250,000 seed funding to put into their companies- who will themselves be owners of their own start-up.

 

If you have always wanted to work within a successful start-up of your own, consider joining the Alacrity Foundation Programme. More information can be found here. 

 

 

Write a comment

How to Write an Executive Summary of a Business Plan
How to Write an Executive Summary of a Business Plan

SUBSCRIBE TO WCIC.tech