Ideation — How to generate startup ideas
This article is part of a case study “From zero to profitable business within 3 months”
From zero to a profitable business — This is a journey!
But where do we actually begin this journey? What is the very first step that we need to take in order to achieve that goal of a profitable business?
Well, every business starts with a business idea!
Now, either you already have a business idea or you need to come up with one.
In this article, I will describe some ways how to come up with business ideas. In my experience, with the following techniques, it should be possible to come up with several business ideas. But there are literally hundreds of Ideation techniques that you can use, so feel free to search around for more methods which can help you to generate ideas.
Generating ideas is only the first step though. Afterwards, we need to evaluate them and then decide on which idea we will focus. However, never throw your generated ideas away. Keep your collection and keep collecting ideas permanently, so that you always can refer back to or gather inspiration from this collection.
💡 1. Step: Idea Generation
Business ideas can be basically categorized into two areas:
- Solving a problem
- Fulfilling a need
These are the reasons why the customers will check out and eventually buy your product: Either they want to have a problem solved by your product (e. g. manage dates through a calendar software) or they want to have a need (emotionally) fulfilled (e. g. fashion, video games, movies).
In very simplified terms, we can express an idea as the following equation:
Idea = Problem or Need + Your product or service
While your product/service is actually solving this problem / fulfilling this need.
So let’s say we want to solve a problem, then it is the best way to start with the problem itself instead of with the solution. That’s actually a mistake many people do and oftentimes the reason why so many startups fail, for example resulting in no market need because not enough people have this problem (honestly, there are many other reasons why startups fail, but this is definitely one on the top of the list).
“Oh, I have this awesome idea of this app that does X and I will make it so beautiful and everyone will download it.” — Well, that sounds great in theory, but what problem are you trying to solve? Why are you doing that?
The solution is actually based on a problem, so we should start right there at the root. Remember, the people want to have their problem solved. And certainly, we can think of a solution to any problem. But not every problem needs to be solved, or in other words: not every solution has a problem that needs to be solved.
Paul Graham writes the following:
“The way to get startup ideas is not to try to think of startup ideas. It’s to look for problems, preferably problems you have yourself. The very best startup ideas tend to have three things in common: they’re something the founders themselves want, that they themselves can build and that few others realize are worth doing. Microsoft, Apple, Yahoo, Google, and Facebook all began this way.”
“Starting with a solution is like building a key without knowing what door it will open. You can try testing your key on lots of doors or you can start with a door you want to open. When you fall in love with the problem, versus your solution, you start building keys to doors that actually take you places.”
There is a really great TED Talk by Simon Sinek in which he says:
“People don’t buy what you do, they buy why you do it.”
And if you check out some very successful businesses such as Apple, Microsoft, Uber or Airbnb, you will find that these companies strongly promote their mission, their purpose, their WHY.
You will simply come up easier with your “Why” when you exactly know what problem you are trying to solve. If you think in solutions, you will instantly answer the “What” and probably the “How” of your business. But the answer to the “Why” is actually rooted in the problem part of the idea equation.
“We are doing [WHAT] in a way of [HOW] because we are trying to solve problem X / we are not happy with situation X / … [WHY]”.
So, with this background knowledge, here are some ways, how you can generate ideas effectively. Make sure to remember the idea equation and to generate problems as well as multiple possible solutions to the problems.
Three last important things:
- Don’t limit yourself at this stage!
You can be totally creative while looking for problems as well as for solutions. There are no stupid ideas at this stage! The evaluation and refinement will come later. But now, allow yourself to come with everything that’s on your mind 🙂 - Take your time and don’t pressure yourself!
We can certainly use these techniques to come up with ideas. But take your time for this. Don’t expect that you will get the “Next Facebook” idea within the next one or two hours. If you pressure yourself, your brain will just be blocked. So relax, and start collecting everything that comes into your mind. - Be open-minded and collect all the ideas that you get!
My advice in general: Be open-minded! Go with open eyes through the world, listen to people, and collect all ideas permanently that come into your mind.
🙇 Start with (your own) problems
As mentioned above, starting with problems and then thinking about solutions is a great way to come up with ideas. So, think about your own life. What problems do you have? When was the last time you were angry or mad? When did you complain the last time?
You can also have a look at other people’s problems. When did you help someone else with his or her problem? When did you hear someone else complaining the last time (which is not too difficult here in Germany, just go outside and soon you will hear people complaining about stuff 😉)? Browse a little bit through Reddit, Twitter, Facebook etc. and see what people are having problems with or looking solutions for.
If you really think about it, you should get a decent list of problems. There are TONS of problems in the world waiting to be solved.
🎇 Get inspired
Why not getting inspired? You could look up the story of some popular companies such as Google, Apple, Facebook, Dropbox etc. and see how they started.
Have a look at some Medium Publications, Indiehackers, Hackernews, or VC websites (they often write about ideas or fields they are investing in). Also, there are tons of business idea lists online. Furthermore, you can check out the pain points people have with current products, e. g. in Sub-Reddits or at sites such as canny.io.
The point here is to use this research as a stimulation to come up with your own ideas. Use it as an inspiration.
🔮 Imagine the future
Another powerful way is to not only think about the present but about the future. How will the future be like? What problems will we have? What companies will exist in the future? Just remember how the life was 5 or 10 years ago. Just have a look back 10 years ago and see what didn’t exist back in this time ;)
Also, check out the Gartner Hype Cycle for Emerging Technologies as an inspiration
🛠 What could be done better?
While the “Start with (your own) problems” idea is more about thinking about concrete problems, the goal of this question of more to rethink and question your daily routines. What are you doing/using daily? Are there things that could be automated? Is there anything that could be done in a much better way? What could be optimised in order to save time or money or offer a much better quality?
🎨 Use creativity techniques
There are literally TONS of creativity techniques which you can use in order to come up with new ideas. You could basically fill a book, so listing all techniques is unrealistic. But here are some techniques shortly described. If you search for “ideation techniques” or “creativity techniques” you will find hundreds of more, even complete books about such techniques.
- Brainstorming / Braindumping: The way I would do this alone is to try to come up with ideas (you can also use the other techniques here described) and then use these ideas to come up with even more ideas
- Analogy Thinking: Change the perspective and think about analogies of the problem and analyse this analogy, look for similarities and use these similarities in order to gain new ideas.
- SCAMPER is an acronym that stands for the following action verbs which you can use to come up with new ideas:
S — Substitute, C — Combine, A — Adapt, M — Modify, P — Put to another use, E — Eliminate, R — Reverse - ABC-List: Go through each letter of the alphabet and think about ideas for each single letter
- Disney Method: You are thinking in four different ways: Outsiders (analyse the problem), Dreamer (dream and think about ideal solutions), Realisers (review the ideas of the Dreamer and think about the concrete realisation of these) and Critics (review the plan of the realist and critically search for risks and weaknesses).
I think you get the point. You can use such methods to generate new ideas or use your already generated ideas to even come up with more. Remember what Steve Jobs said:
“ Creativity is just connecting things”
🧘Meditate
Probably everyone had this feeling once — you are taking a shower and then suddenly you get an awesome idea. There are studies that claim that 72% of the people have the best ideas while taking a shower.
Relaxation is important for creativity! So, why not relax? Disconnect all your devices, take a shower or a bath, or meditate! Let the thoughts come and go and see if some ideas come into your mind. But remember — don’t force yourself to create ideas in this time. Focus on relaxing.
🌝 10x Thinking / Moonshot Thinking
Allow yourself to think big! Have a look at Elon Musk. He wanted a new payment method on the Internet, so he created PayPal. He wanted an innovative electric car, so he founded Tesla Motors. He wanted to give people the chance to go to space, so he created Space X. He wanted high-speed transportation, he’s creating Hyperloop.
You can go wild in this phase! Don’t think how you can make something 10% better, think about how you can make it 10 times better. This is what innovative companies such as Google, Facebook & Co. are doing the whole time.
📈 2. Step: Idea Evaluation
You should have collected a couple of ideas at this point. Now, we need to somehow choose an idea we will focus on. So we need to do a very first evaluation of the collected ideas.
In this case study we have the following restrictions:
- We want to go to a profitable business within 3 months
- We want to this with bootstrapping: This means we are doing it alone, without a team and without investments, and we are doing it with the skills and resources that we have
Even if we didn’t have this time and bootstrapping restriction — we are always restricted in some ways, even if we have a team and an investment.
Feasibility
So this raises the question for the feasibility: Can we actually do it? Can we do it in this time span? Can we do it alone, with our skills and resources?
This focuses more
As I mentioned earlier, we can think of a solution to any problem. But also not every problem needs to be solved, or not every solution has a problem that needs to be solved.
Viability
Consequently, this raises the question for the importance or viability: Should we actually do it? Can this actually become a sustainable business? Does this align with my goals?
So, go through your ideas and answer these questions for each idea. Rate every idea from a scale to 1 (totally not feasible / totally not viable) to 5 (extremely feasible / extremely viable).
Then, choose the top three ideas with the highest scores.
🎯 3. Step: Decide
We have rated two important dimensions so far: Feasibility (Can we do it?) and Viability (Should we do it?). This was rather a rational evaluation. In this step, we will evaluate the top three ideas more from an emotional side: Desirability
We can do it, we should do it, but do we WANT to do it?
With this dimension, the circle closes and probably many people know this sweet spot from methods such as Design Thinking:
Regarding the Desirability, you should ask yourself these questions:
- Can you identify yourself with this idea? Do YOU want to work on this idea? Are you passionate about it and interested to work on this?
- What about other people? Will other people want this? Will other people find this valuable? (Do your best guess here, use your experience or do some really quick research, because we will validate this in detail in the next steps)
You want to answer both questions with “yes”. Of course, it’s important that other people will like this idea so that there will be enough customers for your business. But also, it is important that YOU like, better love, this idea. There is the chance that you will be doing this for a very long time and the next validation and building steps will not always be easy. So if you are not convinced from this idea, try to look for other ideas.
Another advantage is that if it’s your own problem and you solve it, but the business model fails, at least you gained a lot of knowledge and skills in this field and solved your own problem.
“Love the Problem, Not Your Solution”
Maybe you can validate your problem, but the solution you thought about is not what the customers actually want. So it’s always good when you are passionate to work on this problem in general.
So, out of your three top ideas, choose the one which has the highest desirability. Which idea are you the most desirable about? Which idea do you think are other people most desirable about?
👉 Conclusion
The Ideation is basically the very first step in our journey towards a profitable business.
But there are a few things to note here:
- Nothing is carved in stone!
We are in a pretty dynamic process, so things will probably change. Our idea is based on hypotheses: There is a problem that (enough) people have, people want to have that problem solved, your solution solves that problem as your customers want it, your customers are willing to pay something for your solution because it offers them unique values and the problem is large enough etc. So we will see if this is all true in the next steps! - Idea ≠ Business (model)
Ideas alone are pretty worthless unless you do something with them. The idea itself is just one piece of the puzzle.
So with this knowledge in mind, in the post I will apply this knowledge by myself to come up with a business idea that I will focus on during the next weeks.
Afterwards, we will explore the other parts of the puzzle. We will transform the idea into a business model, find out the hypotheses, create experiments for these hypotheses, test them and much more!
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