How to choose a killer business idea

  • Rule #1: Accept that there aren't really any "killer" business ideas, just killer executions. Ther are no bad ideas either, so spend as little time as possible on ideas and move forward
  • Rule #2: Solve a problem that people like you have everyday (you don't need to be the next Zuckerberg to be a success)
  • Rule #3: Shortlist your ideas and use the right tools (e.g. Google Keyword, Quora etc) to stress-test them

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Graham D Brown - author of the guide

What are you going to learn in this section?

You have an idea, how do you now turn it into a business?

Because the idea stage is the beginning of your business, it’s really important to point you in the right direction. Too many entrepreneurs spend too long on their ideas, focus on the wrong ideas or fail to test them properly.

There is a science to choosing the right idea and reducing the risk of your business failing. I want to teach you that science in this book.

CHAPTER 7

WHAT IS THIS?

You're reading one chapter from my new Guide:
How to Become a Lifestyle Entrepreneur

HOW TO CHOOSE A KILLER BUSINESS IDEA

  • You need an idea to start a business, but don’t get hung up on finding the right idea
  • Even bad ideas can make good businesses
  • It’s better to start with a half-baked idea and refine it later than try get your idea right before you test it

Turns out even Cockroach Sushi can make money…

Tina Seelig is Professor of Entrepreneurship at Stanford University.

In her book, “What I Wish I Knew When I Was 20”, she describes a task set for students where they have to list the worst possible ideas for a business. Here’s one of the worst examples:

  • Cockroach sushi

Take cockroach sushi, for example. You’re probably thinking “WTF?”

Once they have their “worst business ideas ever” list, Seelig tells the students that they have to now take that idea and turn it into a successful business. The results are revealing.

In almost all cases, students overcome the bad idea and turn it to their advantage:

  • Sure, Cockroach Sushi isn’t for everyone but it’s a great talking point. Cockroach sushi becomes an experience for the adventurous. It’s bragging rites. It’s content to share on Instagram and Snapchat. Cockroach sushi, when pushed, becomes a potential business.

To illustrate this point, I’m going to borrow some of the back-of-the-envelope math from Derek Sivers’ book “Anything You Want” where he suggests that “ideas are only multipliers”. Consider this exercise for example:

  • Bad Idea: $1
  • Good Idea: $100
  • Excellent Idea: $100
  • Bad Execution: $0
  • Good Execution: $100,000
  • Excellent Execution: $1,000,000

Let’s put this together.

You have a good idea and bad execution. Your business is worth $0 (e.g. Lousy Pop-Up Sushi Store)
You have a bad idea and excellent execution. Your business is worth $1,000,000 (e.g. Cockroach Sushi!!)

So, you had a great Idea for a business but unless you can Execute that Idea well, it’s worthless. Execution is the key to a successful Lifestyle Business and core to that Execution is giving customers what they want.

  • Ideas are only multipliers
  • What really matters is your ability to build a good product and get someone to buy it
  • Wasting time perfecting an idea is Wantrepreneur behavior and it only increases your risk long term

Cockroach Sushi wins! You’ll be glad this is just an exercise, I’m sure.

A word of warning, then. If you want to do Epic Shit, you need more than an “Epic Idea”. It’s better to have what looks like a bad idea or a half-baked idea then spending forever trying to find a killer one.

It doesn’t matter, what matters is your ability to turn that Idea into a Product.

So, yes, the title “Killer Idea” is a little misleading if you’re thinking this is how to find the next game-changer that’s going to make a billion dollars.

A Killer Idea really is any idea that we can turn into a product fast enough. We need to have a starting point for that Product, and that’s your Idea whether it’s Cockroach Sushi or the next Facebook… but my point is this: there are no bad ideas, so get over yours.

WHY YOU SHOULD PICK YOURSELF

  • In most business cases, you don’t need permission to do anything
  • If you want to be an expert, declare yourself an expert
  • If you want to be a leader, plant a flag

When I started my first business after college, I got some business cards printed.

I didn’t have an office and websites were very new back then. I showed a friend my business cards one lunchtime and he said to me, looking at my job title, “You can’t just call yourself CEO… my boss has been with our business for 15 years and he’s not even CEO yet.”

I didn’t ask for permission, I picked myself. And that can ruffle feathers, because it’s our cultural instinct to wait to be picked.

At school they lined you up and then picked the kids in order of preference who would play for which team. Then you went for a job interview where a guy in a suit either picked you or he didn’t. Our world was full of “experts” from radio DJs to magazine editors who picked what we should be listening to or looking at.

So, when it comes to shortlisting ideas for a business, we too get held back by these hangups.

Are you qualified to do Epic Shit?

Well… there is no qualification needed or person to do the picking. If I want to do Epic Shit and write a guide on how to be a Lifestyle Entrepreneur, I can pick myself.

There is no world governing body that recognizes who is an athlete and who is not. Sure, there are athletic federations, and in many sports you can register as a professional and get your “card” but amateurs, too, are athletes. There is no degree, no piece of paper, no standard. There are no official requirement for calling yourself an athlete. So, when I call myself an athlete, it’s because I picked myself again.

And, that probably applies to pretty much anything in life…

You only have to pick yourself.

You can choose whichever story works for you. Design a business that you can be passionate about. Chances are that if someone else is passionate it too, you can make money doing it.

START BY SCRATCHING YOUR OWN ITCH

  • Your best business ideas come from your own everyday problems
  • Your success will depend a lot on being able to connect emotionally with customers
  • It’s easier to access your own emotions than second-guess those of people you don’t know

You know that there are no bad ideas so you’re not going to get hung up on finding the perfect one. You also know that there’s no qualification or permission needed to turn that idea into a business.

Now we’ve cleared the decks, where do you start with your business Idea?

Your first goal is to create an IDEA SHORTLIST.

  • Brainstorm a list of ideas you could build a business on
  • Everything goes, nothing is crossed off or pre-qualified
  • We’ll narrow this shorlist down later

This is a no-holds-barred list of wacky ideas where everything is okay, no matter how outrageous. We’ll work through the process and aim to get 10 Ideas on your SHORTLIST then finally narrow them down to one.

If you don’t know what your customers will love until you ask them to buy it, it seems like a Catch 22 loop doesn’t it? Well, no… we can avoid that if we start with a rough idea.

Your rough idea is an educated guess. It’s your first stake in the ground. You may be way off-mark but it’s better than having no stake in the ground at all.

The best place to start is you. You are your best focus group right now. What is the itch that you need to scratch? What is the problem that you are facing in your daily life that you wish someone could solve?

  • You want to go live some exciting adventures, like India or the Himalayas, using your photography skills but your current job doesn’t allow you the bandwidth or the money to do that. Wouldn’t it be great if you could get paid to take other photographers on these adventures?
  • You want to move to Chiang Mai in Thailand but there are 100 things you need fixing on the ground before you get there – from accommodation to mobile phones to schooling. Wouldn’t it be great if somebody could do that for you?
  • Wouldn’t it be great if you could have an app that tracked your workouts better than Google Spreadsheets but without all the extra crap they throw in from the App Store?
  • Wouldn’t it be good if somebody could … for me? is usually a good starting point for a business idea

It’s important you focus these ideas on areas of emotional importance to your life for example your passions or your dreams like travel, Ironman triathlon or photography. The reason is twofold:

  1. You can really empathize with what the problem is at an emotional level and
  2. There are probably other people just like you thinking and feeling the same things

So, take out a blank piece of paper and write down your first 3 Ideas for the SHORTLIST. Be as descriptive or as brief as you want. These are business ideas that you would love to do. It’s really important not to judge or discard any idea as stupid or not do-able, we’ll do that at a later.

Now you have your first 3 Ideas, congratulations. Go back and extend that list to at least 10 Ideas. You’ll find that the closer you get to 10, the more interesting and raw the ideas become. If you can’t think of anything, or get stuck for more than 3 minutes at one time just write “naked yoga teacher” and move on to the next line…. Why? Because anything is better than nothing, and if you don’t have anything better to make a difference in the Universe, perhaps this is what you need to do. Besides, you might enjoy it.

  • Brainstorm 10 ideas for your shortlist
  • Each idea can be a variant of another
  • If you can’t come up with an idea write down “naked yoga teacher” and move on

Now you should have your IDEA SHORTLIST with 10 Ideas. There may be a few “naked yoga teachers” on that list, hopefully not 10, unless that’s what you really want to do.

So, the next step is to start turning that list into products that your customers will love.

FIND YOUR USEFUL

  • You don’t need to change the world to be successful
  • Being Useful (rather than Innovative) is a great way to build a business doing what you love
  • Innovation can drag you into an ego-trap that ends up with a successful business and an unhappy lifestyle

What we’re going to do is go back through the SHORTLIST and turn these Ideas into Solutions.

To do this, we need to Find Your Useful.

Usefulness isn’t changing the world, or developing the next billion dollar app. Usefulness is solving a problem your customer has in their everyday life.

“Wait a minute… back up!” you might be saying, “I’m planning to do Epic Shit, not helping old ladies cross the road!”

Okay, allow me to explain. That’s not Usefulness. Perhaps to understand it better, I’ll explain what the opposite is. The opposite of Usefulness, and the temptation that traps many entrepreneurs is Innovation.

Innovation is fun, exciting and sexy. Innovation grabs headlines. But, innovation also suffers from survivor bias. We only see the winners. What of the 10,000 apps that tried to build ride-sharing services like Uber but failed? It’s tempting to do Innovation because it sounds like it’s the natural bed-fellow of Epic Shit, but it’s not.

  • Don’t get seduced by the sexiness of innovation
  • The upside of innovation is that it’s exciting, but behind lies a trap that can ensnare you

Epic Shit means having a purpose, making a difference… and Innovation is too often driven by our own needs, rather than those of other people.

Starbucks for example isn’t Innovative, it’s Useful. Starbucks doesn’t sell great coffee, it solves a problem we increasingly face – lack of quality space to relax, meet people or work. Starbucks may not be the most exciting brand in the world, but what it’s achieved is pretty Epic… Consider that it doesn’t advertise and it’s the most shared brand on Instagram. Consider that it offer its employees health insurance (when it doesn’t have to) and even loans to help their education.

Your Idea doesn’t need to be a world first to be worthwhile. Don’t get lost on the end result as a measure of your success. Just building businesses that are Useful to people’s lives every day itself is an Adventure, and that’s a worthwhile challenge.

  • Solve a problem that people like you have on an everyday basis

So, let’s break down Usefulness first:

  • Solving a problem
  • People like you
  • Every day

Solving a problem: fixing a pain, frustration or something that’s broken with a simple solution

People like you: you and your tribe around you

Every day: a problem that is common and part of our normal lives

Solve an everyday problem. Rather than think in terms of big opportunities, think about the frustrations and pains people feel on a regular basis and try fix them.

So, what are “everyday problems”?

People are less motivated by opportunity and more by pain. In marketing, we used to call this “customer pain” or “pain points”. Often this is a real frustration or negative emotion associated with something that doesn’t work or makes them look stupid.

  • Try to see your idea in terms of the fear, pain and frustration that people feel

Years ago I experimented writing books for Amazon. Most didn’t sell very well, but one that continued to outsell all the others combined (and to this day) is about hill climbing for cyclists. Hill climbing is a big problem for cyclists and it can be very frustrating. It’s not a problem because it’s physically tough but many amateurs don’t understand how a 30 year old healthy guy can get dropped by a 60 year old club cyclist who hardly breaks a sweat on the climb. It’s frustrating. It’s a subject of constant ridicule in cycling circles and it’s real pain that hobbyists feel.

I got it, I felt that pain when being ridiculed for being dropped on a climb.

That book was Useful for people just like me. It didn’t matter that I wrote it in a couple of days and had a crappy cover. What mattered was its ability to fix their problem.

There is important reason why we should focus on Usefulness rather than Innovation.

The more Usefulness you create, the more Freedom you have in your business. If you can be Useful to somebody while you’re wearing your pyjamas or lying on a beach in Thailand, does the customer really care?

  • Lifestyle choice is closely tied to Usefulness
  • The more Useful you become, the less customers want you to conform to traditional business protocols and stereotypes

If the customer doesn’t care that you’re a one-person business or operating out of Thailand, she also doesn’t expect you to be on-call 24 hours a day. She also is going to be okay with the idea that there may be mistakes in your product, or your website has grammatical errors, or you don’t have a regularly updated Twitter feed, or she can’t just walk into your high-street office down the road.

Freedom gives you the options to live the Lifestyle you want.

So, let’s go back through your SHORTLIST and turn these Ideas into Useful solutions.

Idea Pain Solution
Photography Tours Amateur photographers spend a lot of money on it but where do they get to really test their gear and share their experiences with likeminded people? They want to get “out there” an experience adventure but nobody in their network shares that desire. You can take a group of these photographers for the adventure of a lifetime in some challenging destinations while at the same time show them the tricks of the trade, and get paid!
Chiang Mai Relocation An increasing number of travelers are relocating to this Northern Thailand City for long periods of time – from months to years. As individual travelers their needs aren’t met by tour companies but their needs often go beyond finding places to eat and sleep. By selling your experience of the area, you can offer a concierge giving these travelers are door-to-door service covering all their living needs. You’ll charge more than the cost of sourcing these services individually, but your solution isn’t cost – it’s about trust and saving them time
Workout Apps There are 100s of workout apps available on the App Store but the problem is they all keep their data within their own ecosystems. Many serious athletes want to have access to their data off the phone, on easy-to-use Google Spreadsheets accessible through their browser. Your workout app will look like the rest of them but rather than require your data stored on the phone, will neatly format it for Google Spreadsheets. That way you can easily access, review and edit it.

GOOGLE KNOWS WHAT YOUR CUSTOMERS WANT ALREADY

  • Before you build your product you should check if there is a demand for it
  • Google’s Keyword Tool gives us a great insight into what people are searching for (and buying)
  • Google’s Keyword Tool is the closest tool we have to looking inside somebody’s head

The only true way of testing the validity of an Idea is to ask someone to pay for it.

I call this “the moment of truth”.

That’s what we’re going to do in the next step. But, before we get there we want to narrow down our 10 candidates to 1 Idea that we feel good about turning into a raw product.

Small amounts of effective research and preparation up front can save time later on. The best way to know what people want is to see what they are already paying for.

In the old days, we’d do focus groups but they were expensive and took time. Today, you can use Google. Google lets you get into the head of your customer. Using Google’s Keyword Tool, we’ll narrow down your shortlist. We are trying to reduce the risk of you wasting time and money building products that nobody wants.

What we’re going to do is take your SHORTLIST and run keywords associated with these ideas by Google and get some feedback.

  • Take your Idea Shortlist and run the idea through the Google Keyword Tool
  • Search for key phrases that people will type related to that idea and the problem they’re having
  • We’re looking for searches that advertisers are bidding for already (rather than undiscovered ones)

Google is going to tell us one of 4 potential outcomes for each idea on your SHORTLIST.

Find out what people are paying for: using Google’s keyword planner

If you were mining for gold, you’d mine where the gold is right?

The same applies to your business.

  • It’s better to build a business around what people are paying for already
  • Don’t bet on developing a new market (unless your name is Branson or Musk)
  • We’re looking for searches that advertisers are bidding for already (rather than undiscovered ones)

The good news is that you can access tools that will tell you what people are paying for already. A good example of this is Google and their Keyword tool.

https://adwords.google.com/KeywordPlanner

(you’ll need to connect your Google account to make it work, but don’t worry you don’t have to spend any money to use this tool)

By typing in typical search terms into this tool, you can find out what people are paying for already.

Let’s say you’re building a photography tours business and you’re interested in India.

  • Type in “Photography Tours India”

  • Now, I can see there 100-1,000 searches a month on this term which is good (try avoid anything below 100 unless it’s ultra niche and specific)
  • You should get a bid value of $1.31 / £1.01 (this will change a little by the time you do it)

What this tells us is that advertisers are paying money every time someone searches that term for their ad to come up on the results page. Of course, there are plenty of advertisers using Google Ads who haven’t got a clue how it works and are just throwing money at bidding on search terms. But, over the long run, over many results, these anomalies will smooth out.

Bid amounts give you an indication how much money advertisers think they can make out of these searches.

If you now go and look at Google’s public search page, and type in “photography tours India” you can see that the top 2 results are ads.

photography tours india

What have we learned?

That there are 2 advertisers paying around $1.31 for every time someone clicks through on their ad to the website.

Of course, there is no guarantee of any sale but it’s a numbers game. Maybe for every 50 clicks they get one sale, that means they know each sale costs them $65.5 (1.31 x 50)

If a sale of a photography tour is worth $1,000 profit, they have a profitable marketing funnel and for you it’s good evidence that there are customers out there willing to spend money on a product relate to that term.

Search for terms with high bids

People make the mistake of using this tool to find keywords that no advertisers have found yet, ones with low competition.

Look at the example above. If you click the “suggested bid” column once it will organize the results by the lowest bid first. In this case you see “best place for photography in India.” The bid is only £0.01 which is nothing but it’s high risk. Nobody has developed that market. It’s saying that although there is a chance this may be a home run hit and you’ve discovered something nobody knows about, chances are it’s not.

Chances are, it’s a term people search for with no intention of buying anything.

Let someone else take that chance.

I always assume that given the global nature of the internet and how there are 1,200 entrepreneurs looking at dog shampoo products right now, that pretty much every niche has been checked or covered.

  • Whatever your idea, it’s not new
  • Assume someone somewhere in the world has thought of it already
  • That’s fine, we want to know if they made money out of that idea or not. If they didn’t, we should be careful

What you should look for is search terms related to your idea that have high bids.

Go back to the results and click the “suggested big” column again and it will reorganize by highest first now.

Scroll down your results and you’ll find this..

“Travel photography courses in India”

It’s a little more niche with only 10-100 search terms but the big amount is higher (compared to £1.01 earlier).

  • Try to find valuable niches in your business ideas

It sounds more or less the same type of search, but with a key difference:

  • Search 1: photography tours India
  • Search 2: travel photography courses India

People are more likely to spend money if they type in the second search. There are a few reasons for this which we’ll only know if we dig deeper into the sites behind them but for now here’s an overview:

  • Different searches, different people
  • Some terms show more “intent” of purchase. A good example of this would be comparing “travel photography” with “travel photography course”. The first could be anything – blogs, photo galleries, books etc. In our example, if somebody types “course” it shows they are looking for a product people normally pay for. Not always, but a tour could be day excursion. Courses could be days or weeks.
  • Generally, long searches are more specific. People don’t usually type in long searches unless they know what they want. The longer the search, the more specific the search.

START LEARNING YOUR CUSTOMER’S LANGUAGE

  • Always speak your customer’s language
  • When you’re obsessed about an idea it’s easy to assume what you know or the jargon you use is normal speak

ATM (automated teller machines) are a feature of our daily lives. How did we ever live without them?

Well, there was a time when they didn’t exist. But, banks are kind of expensive to run with all their staff and fancy furniture, so engineers had to work out how to get people to use ATMs instead.

The problem was when asked in focus group, “would you deposit your money in a machine like this?” most people said no. They were stumped. People didn’t trust these robots with their money.

And that’s the problem. You have to work within the language of what people know and do already. People like what they know, so don’t fight it. Instead of depositing your money into this robot, they told customers it was “like going to the branch and depositing your money with an automated teller”

Customers got it because they got “going to the branch” and they got “tellers”. They didn’t like queuing up and wasting their lunch-breaks waiting, so this automated teller solved their problem.

  • Phrase your business idea in the terms people will understand, not the ones obvious to you
  • Try to build within existing behaviors rather than expect customers to learn new ones

It’s the same with your customers too. Find out what their problems are and use the language they already understand.

The last exercise should have showed you the kind of language and terms people are familiar with (and those they are not). Don’t try to fight this trend of hope to educate the market.

If your Ideas don’t exist in the world of Google, don’t risk waiting for the market to catch up. Instead, start couching your Ideas in the language of the customer. Remember, a big part of your business is people searching for an discovering you on the internet, so if you are fighting against that free marketing, you’re going to need a big marketing budget (which is beyond the scope and purpose of a Lifestyle Business).

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