Hands down, the most annoying sentences I have heard hundreds of times are "I have an idea for the next billion dollar business" and "I have an idea for a startup that will revolutionize a huge industry."
If you have any idea that you think can become a huge business, sit down, because you won't like what I am about to tell you. You are most likely wrong and your idea has either been done successfully or unsuccessfully, or there is a hole in your strategy that will make the idea unmarketable, or you won't execute against your idea well enough for it to become a sustainable business.
Ideas don't become billion dollar business and don't revolutionize anything. Execution does.
This is not my opinion. These are hard statistics. 75 percent of venture-backed startups fail. This statistic is based on a Harvard Business School study by Shikhar Ghosh. If your idea does succeed, you are the exception, not the rule.
It is 2018 so the situation is only getting worse.
Today, more than ever, tech and innovation have gone mainstream. Geek is the new cool. Everyone wants in on the startup action, everyone thinks they are the next Zuckerberg.
Everyone has ideas. Few actually bring those ideas to fruition. The noise is only increasing and the startup life is being more glorified than ever. If you have an idea, join the party. If you execute on that idea, now we have something to discuss.
The list of action items is quite literally, endless.
The number of things that have to happen for your idea to become a business is so large, that had you comprehended that number, you would have realized how insignificant your idea was. One guy who pitched me an idea had already decided what the company valuation would be in 12 months.
All he had was an idea. I didn't know whether to laugh or cry.
Now I realize if you have a startup idea and you are reading this, you are probably hating me right now, so let me say this. Every successful business you know of, started with a good idea.
So, take your idea and run with it--and remember this idea is quite literally one tiny little ingredient in the 10 course meal you are preparing. Without this ingredient, the idea, the dishes you are about to serve have no flavor, but at the end of the day, it is still only one ingredient.
You have an idea. Now what?
There's no secret formula to building a successful business and anyone who tells you there is, is someone you want to think twice about working with. However, there are many things you absolutely must do after coming up with what you believe is a great idea.
First of all, ask yourself if it really is a great idea. You might think it is, but does the market agree? Google is your friend. Who else is doing this? Who else tried to do this? Who else is targeting the same audience as you? What are or were their challenges? How are you going to differentiate yourself?
Just because your idea is great in your mind, does not mean that it is actually objectively great. A great product without a market is the equivalent of a fantastic basketball player that has no access to a court or a rim. Your skills are appreciated but you have nowhere to apply them, so perhaps it is time to consider another career.
There is a market, but how will you get to it?
If you passed the first test and there is still a need for your product on the market, you are headed in the right direction. Now you have an idea and a potential market.
But then, you have to ask yourself the hardest question of all. You are proud to declare that your potential market is huge, hundreds of millions of people and billions of dollars, huge.
Now, how exactly do you plan on penetrating that market? How will you acquire users at a large enough scale to make this a profitable business? What is your Go-to-Market strategy? At this point, no one is expecting you to know your cost per user but a high level plan of how you will scale your user base would be nice.
These two action items of researching the validity of your idea and planning a strategy to penetrate the market are just the tip of the iceberg. Those two steps alone could, and should take you months if done properly. You are approximately 2% there.
Now you see why an idea is just an idea?