Idea: The Foundation Stone of the Entrepreneurial Edifice

The right idea: it is what lays the foundation for a successful venture. What you do later comprises of the edifice built on the foundation of a validated idea.  With an appropriate idea, you proceed to build the organization, develop business strategy and execute the idea.

So how do you select the right idea for your venture?

Your chosen idea must solve a customer problem or be a new way of delivering an existing service or disrupt an existing business.

The process of choosing the right idea, the single most important decision you will make in your entrepreneurial venture, is the choice of your idea, around which you will build your business.

Sometimes, the entrepreneurial opportunity seems so hot and so compelling that people who have never before considered becoming entrepreneurs decide to take the plunge.

Here are some tips to arrive at the right idea:

Adopt a Kaleidoscope approach

You must have been fascinated how a small turn in a Kaleidoscope presents you an entirely new combination of patterns. In the same way, a small change, be it in a product or service or business model can throw open a new entrepreneurial opportunity.   Fairly common examples are ‘Business to Business' models where a new entrant converted the model into 'Business to Customer' one. The car rental business of Uber & Ola can also be considered applications of 'Kaleidoscope' approach.

New Technologies:

Changes create opportunities. Most of the changes are driven by new technologies which make business models possible or create new services. It is important to understand the business- creating power of such technologies. The opportunities are limitless.

Personal Experiences:

A young man found himself stranded at his hostel during Diwali as he could not get tickets for his hometown. This set him thinking, “Why there is no facility of providing information about the travel options and facility to book them from anywhere?". The idea led to multimillion business idea of the Red Bus!

Other Sources:

Other sources of generating concept are prior work experience, family business, friends and education courses.

Before zeroing in on your chosen idea, socialize the idea with your own LinkedIn and Facebook networks. Share it with friends and mentors. Through this journey, the idea becomes more meaningful as more insights and angles are added to it.

Visualize the idea:

Visualize the seed of your idea growing up into a full-grown tree. Deepen your understanding of the idea and strengthen your conviction in it. For the entire gestation period you must live, breathe and dream the idea.

Validation of the idea:

Present your idea to individual investors and venture capitalists and discuss your vision with them. The responses from several investors help to reshape the idea.

Another approach of validation is more structured and formal:   testing the feasibility of the same. This may be through market research, study of focus groups and/or pilot launch.

In the same context, it is also important to look at existing and future competition, which has a nasty way of emerging from unexpected sources and directions.

Additionally, an important validation question for your venture is whether the timing is right given the market conditions. If yours is new product or service, is the market ready for it? Does the required ecosystem /infrastructure exist to support its success?

'Head, Heart and Gut' Test!

When you have put your idea through a validation wringer and looked at it with realistic optimism, it should pass the “head, heart and gut” test.

While the head gives you the rationale, the heart speaks your emotions.

• Is the idea the one which you are enthused about? 
• Will it help you create an organization?
• Will it bring joy and happiness to the team?

Finally, the gut is your instinct or intuition on how the venture will work out in a five years plus time frame. If you find your head, heart and gut aligned, go ahead and press the “Go” button. Odds are you are the winning proposition.

If not, go back to the drawing board and tweak your idea or consult a mentor. Even then, some doubts may remain. Entrepreneurship is all about risk –taking and if you are well geared to tackle the risks, go ahead and take the plunge!

 About Author

Dr. Bhushan Mahajan is Head, Department of Mechanical Engineering and In-Charge, ED Cell, JDCOEM. He has attended FDP at IIM-L.