The Real Deal about Starting Your Own Business

The good news is that starting a business has never been easier. The Internet has made local and global reach easy and instantly available to those who know how to tap into it. Organizations remain cautious about hiring new staff and there does not seem to be a change anytime soon so many of you will have to consider options you would not have in the past.

The bad news is that approximately 95{099636d13cf70efd8d812c6f6a5a855fb6f8f27f35bea282d2df1d5ae896e2c2} of start-ups will fail within the first 10 years. The advice from those who have succeeded is, “Don’t quit your day job. It will be harder, take longer, have more obstacles, and cost more than you ever thought.” This the riskiest Plan B model because of the high failure rate.

There Are Successes

Plan B has worked well for Debbie Meyer who started her businesses to solve problems she faced as a stay-at-home mom. Her first product was a cake cutter, designed to eliminate the finger stuck in the top of each piece as it was served. Her very popular Green BagsTM were developed because she got tired of throwing away spoiled produce. Both products have sold extremely well on TV shopping channels.

Luke & Associates, a contract service provider, is #3 on Inc. Magazine’s Top 500 Fastest Growing Companies. They started in 2006 with 20 employees and today have over 1,300 with revenue of $100 million. Three guys came together, each with a different expertise – operations, IT, and government contracts.

Thinking Through Your Business

There are a lot of people generating ideas who can’t make any money from them. You need to answer two key questions: Are you taking your ideas through to exploitation? Are you following the right sequence? Here is a graphic, created by author and consultant Alan Weiss to explain the process. By the way, I had to Google “Instantiation,” too. It means to define an abstract concept by providing instances of its occurrence…

Ideation: 6 Idea Requirements
To make money you have to bring value that others want

  • Pragmatic – It need to make money right away
  • Immediate – It needs to quickly resolve issues
  • Perceived Value – Others need to find value in it
  • High Visibility – Everyone is watching and evaluating it
  • Universal – There is a large market with similar problems
  • “The Crucible” – Will it withstand the high heat of the marketplace?

Instantiation: 5 Applications
How your idea will be utilized by others

  • Audiences – Who has a critical need for what you offer?
  • Usages – How will they use what you offer? How consumable is it?
  • Results – What are the measurable results?
  • Needs – What do they say their pain is?
  • Trends – What is coming?

Monetization: 5 Vehicles
How your product or service will be delivered

  • Products – How will you get them to the buyer?
  • Services – How will they get to the end user?
  • Relationships – Who can write a check? Who can make strategic introductions?
  • Offerings – How many different ways can you re-package your offering?
  • Scope – What is your business niche? What are the numerous ways to dominate it?

Exploitation: 7 Delivery Applications
The multiple ways you can leverage your offerings

  • Licensing – Others to provide the same product or services under your control.
  • Franchising – Turnkey system
  • Wholesale – Sell to groups that can buy them in large quantities.
  • Retail – Stores, catalogue, on-line purchases
  • Technological – Websites, tools, webinars, teleseminars
  • Remote – Conference calls, Skype calls with clients, radio interviews, TV interviews with local affiliate stations
  • Apps – Books and materials formatted for eBook readers like the Kindle; Problem identification models; Decision tree models

There are volumes of information on how to start a business that can be helpful, overwhelming or confusing. What is hard to find is a simple big picture model to help you work and think through your idea to determine how practical it is. Weiss’ model can help you begin to evaluate your new business idea.