I got a message this morning from a guy in London who wanted my opinion on setting up a peer-to-peer taxi service to compete with Uber and Lyft. He felt he had a USP, but I was already walking away from that mission.
SummaryReason 1:Barriers to EntryReason 2:Misaligned SkillsReason 3:Poor Goal SettingReason 4:Me Too!Reason 5:No MarketBrain Tattoo:I explained that he broke one of the basic rules of goal setting. That of reality.
Uber has raised over $12 billion to get where they are, Lyft around $2 billion so far. My loner in his home office could handle this, but chances are he won't. Already.
Of course, he could also win the lottery. All he has to do is buy a ticket, right?
I like to be brutally honest with my clients. More to redirect than demoralize of course, so here are 5 ways to test if your well-meaning idea might never create a successful business.
Many industries require large investments in machinery, technology, and people to get started. This is a barrier to entry if you have limited access to funds.
Other obstacles could be the need to obtain licenses, authorizations or qualifications before being able to trade. The most common barrier, however, is the cost of being heard.
Do you have a viable path to market at an affordable price?
If not, come up with a different idea.
You are an accounting assistant looking to escape the hustle and bustle of the company you work for. Starting your own accounting business might be a realistic goal.
On the other hand, deciding to start a children's nursery just because you have your own child is not an indicator of success on its own. Learning ABOUT your business while learning how to run it might be too much of a hassle.
Think “I can do this” rather than “I would like to do this”.
It has been said many times that goals should be specific, measurable and realistic. Beyond that, your goals should inspire you.
Goals are not just about numbers. You must really WANT to achieve them. You have to live and breathe your goals. Missing them must feel like dying.
Can you quantify the goals that mean the world to you?
You should.
See also:Gardeners have the secret sauce to setting goals
It's tempting and even inspiring to look at a successful business and think “I could do this”. Maybe you could, but here's the news:they already did.
The market for everything cannot take a certain supply before it is saturated. New entrants then face an uphill struggle to be heard and a downward race to the bottom as they attempt to compete on price.
Try this instead:Do something new and better.
I had a friend who had an intuition. Actually, not an itch anymore that he had to scratch.
Based on his experience fixing his mother's washing machine (and saving her the perceived replacement cost), he figured he could start his own appliance repair business.
He had a van and tools, right?
False. Nobody fixes their white goods anymore, because they found out too late.
Replacement cost is low, products are generally reliable, and extended warranties abound. As the TV Dragons would say:Congratulations, you've found a solution to a problem that doesn't exist!
Don't waste your precious life trying to polish a poop.
Every successful business starts with a great idea.
Find yours and get connected.
See also:Five steps to turn what you love into a successful business
