Tag Archives: business start-up

What makes a great business idea?

As readers of this blog will know, I work with young people to help them launch their own businesses. Business start-up success is, of course, as much to do with the capabilities of the would-be entrepreneur as the quality of their business idea, but invariably I judge the latter before I know the former.

 

When I first hear a business idea, I subconsciously and unfairly assess it by whether the idea personally appeals to me. My passion for social enterprise, for example, tends to make me more positive about business ambitions that are more than just ‘making money’.

Over the past 20 months I’ve been told about over 100 possible businesses. Beyond my personal interests, what can I conclude about the elements of a potentially good business idea?

Is it a novel idea? If you take the ‘five f’s’ – fashion, food, facial treatments, photography and fitness – out of the frame, there are probably less than 50 other ideas. Of these, few have been particularly different, but two stand out.

The first is a shoe-selling service for people with different sized feet and amputees with only one leg. A young entrepreneur with mild cerebral palsy has feet that are two sizes different meaning she needs to buy two pairs of shoes to get ones that fit properly. She knows how costly this is and wants to solve the problem for herself and others by selling odd size pairs and single shoes.

The second business involves selling pearls in oysters that are then set in jewelry pieces of the customer’s choice. Each oyster (scanned at source to ensure it actually contains a pearl) is opened live on social media, with the owner looking on, creating an excitement which builds as the jewelry piece is created in the following weeks (for supply in the oyster shell?)

What are the start-up costs? Cost is as much about the time as the money it will need upfront. Even techy start-ups – with the right in-house expertise – can launch a MVP (Minimum Viable Product) to test the market without a major financial investment. I’ve written elsewhere about the value of not investing too much time and money in a new venture, making it relatively easier to ‘recover’ if/when the enterprise doesn’t take off. Some argue that a high personal investment makes the entrepreneur work harder to make the business succeed (but it can also make them blind to the dead horse they’re flogging).

What’s the competition? Novelty adds interest and ‘instant appeal’, but the most unusual business ideas may be novel for a very good reason; that others have tried unsuccessfully to make them work. This may be down to timing or location, but the rate with which some restaurants continue to change hands on the same site after successive failures makes me think that many restaurant owners believe they alone can buck the trend.

That said, there is something to be said in favour of starting a business in a crowded marketplace – a coffee shop for example. The number of people already selling coffee confirms there’s widespread demand for the product and/or service. And, to some degree, publicity for just one coffee shop benefits all coffee outlets in the locality. When competition is fierce it’s then ‘just’ a matter of doing better than the others. Like the barbershop in my home town which opened on Sundays when the other four barbers didn’t (now three of them do).

One way to tackle the competition is to go for a niche within the particular business sector – something that, with the advent of cost-effective communication through social media, is now more possible than ever. One young photographer is specialising in photoshoots with new born babies aged 5 to 10 days. The beauty of catching ’em so young is the scope for repeat business with milestone photos.

Is the idea simple to grasp? Business start-up ideas tend to be over-complicated. This is partly a reflection on the muddled thinking of the would-be entrepreneur – buzzing with too many ideas and thinking they have to be firing on all cylinders from day one. But if the product and/or service is not clearly communicated, the business tends to suffer because it expects too much of potential customers to understand the offer – they lose interest and look elsewhere.

It’s almost as if young people think a simple idea makes them sound, er, simple. But in a room full of business ideas of varying complexity, the best idea (on a particular day I’m recalling) was described quite simply in three words – cleaning people’s houses. A great business idea – easily explained, low start-up costs, repeat business practically guaranteed for an affordable quality service, and potential customers almost literally on the doorstep. The same goes for the would-be gardener, dog-walker and ‘man with van’ who knows what s/he is doing.

Does it meet a real need? The clichéd definition of marketing ‘selling things that people don’t need at prices they can’t afford’ is, happily, less common now than when the phrase was first coined. If there’s a genuine need for a product or service – rather than one which is somewhat contrived (for examples, look in one of those problem-solving household gadget catalogues that drop through the letterbox) – so much the better. I also like business ideas that try to meet more than one need (without getting over-complicated). One young entrepreneur came up with an interesting idea to provide pamper sessions for young mums at playgroup locations – so both generations could benefit from some play at the same time.

Sad to report that business hasn’t taken off… yet. Business success is never guaranteed and even the best ideas in competent hands can fail for very good reasons. ‘Back to the drawing board’ is not just for would-be architects.

Further reading:

Business ideas to launch in weeks https://startups.co.uk/10-great-start-up-business-ideas-to-launch-in-weeks/

How to turn an idea into your dream job  https://www.theguardian.com/lifeandstyle/2017/aug/14/how-to-turn-an-idea-into-a-dream-job-by-people-who-have-done-it   

Business ideas for 2018 https://startups.co.uk/business-ideas-2018

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Business support – what matters?

On the same day this week that I learnt, with surprise and delight, that I’d been listed as a Top 50 Adviser 2018 by Enterprise Nation, I was reminded by my employer how badly I’d missed my target for business starts. Working with a charity supporting young people with complicated lives I appreciate that, for the funders, entrepreneurial success is best measured in tangibles – loans made (and repaid!) businesses started, jobs created etc.

This is understandable – ‘soft outcomes’ like increased self-confidence and improved mental health, better relations with money and family, are harder to quantify. But it risks giving the impression, to which I’ve referred in past blogs, that only what can be easily counted counts.

A work colleague recently asked me how I would define success in my job. I explained the hard versus soft outcomes debate and then described the progress of a young woman I’ve worked with who will probably never set up her own business but has made massive strides in her personal development. I’ve only played a small part in that young woman’s achievements, but I know she’s not the only one who has benefited from my start-up guidance.

When I was first encouraged to throw my hat in the ring with the Enterprise Nation Top 50 Adviser competition, I decided I’d only do so if I got ten endorsements from the young people with whom I’ve worked over the past 20 months. With only 24 hours to the entry deadline, I had three independent nominations and ten endorsements with some truly heart-warming comments from the young entrepreneurs. See above.

Which is how I come to be in the national Top 50 listing with the possibility of being voted top in the ‘Branding and Design’ category https://enterprisenation.com/top50 If you’re considering voting and you want to get an insight into my work with young people, click here https://enterpriseessentials.wordpress.com/category/learning-about-earning

As you can imagine, I value that expression of support from those thirteen young people far more than any pay packet at the end of the month, but I do understand that I’m employed to keep other customers happy as well.

So, I must dash – there are businesses to be launched.

Enterprise essentials – 21 tips from StartUp 2018

It’s January 13th 2018 and hundreds of entrepreneurs both young and old (but mainly young) are gathered in East London to consider anything and everything to do with starting a business. A great day with loads on on offer – so ‘pick and mix’ was the way to go.

The event was also refreshingly free from business bullshit and the hero-worshipping of edgy, sweary entrepreneurs spouting ‘awesome’, ‘cool’ and ‘disruptive’ all day. In no particular order (as they say on Strictly) I picked up the following tips by keeping my ears pinned back during the day.

  1. The recommended maximum number of questions and completion time for market research surveys is 22 questions and seven minutes (after that there’s a severe drop in response rates)
  2. Success in starting  business is largely down to a combination of ideas, skills and persistence, and lot of them – 90% of business start-ups fail within a year, 47% of retail businesses survive for 10 years
  3. Making products is not business, selling products is the business
  4. Focus on your passions, understand the core mission of your new business, be clear why you are different from other similar businesses (the competition)
  5. The difference between masculine and feminine marketing is the difference between ‘hard sell’ and ‘heart sell’
  6. Talk to as many people as possible- share your ideas freely. Unless your product is technical, forget patents (they’re expensive) and concentrate on protecting your trade mark
  7. Get your products out there as soon as possible – stop talking, start selling – just do it!
  8. Write down 50 people you think should know about your new business, decide how you’re going to reach them, and tell them
  9. “Success is selling something that doesn’t come back to people who do” A cliche, but true.
  10. Work hard, be nice to people, do your research, know your customers, be prepared to sacrifice sleep
  11. Start small, never stop learning and the business will grow with you
  12. When you start out in business think about your definition of success – is it making money, making a difference, or what?
  13. Ideas are worthless, execution is everything
  14. In your business pitch start with the pain for your customers
  15. When you start business planning, list all your assumptions and test each one [before someone else asks you awkward questions]
  16. Mentors are great for keeping you on track and keeping you going, particularly at start-up stage
  17. The highs and lows are more extreme when starting your own business [rather than working in someone else’s]
  18. Know your strengths and [particularly] your weaknesses when starting a business
  19. Tough times at start-up stage can be a springboard for great business development
  20. Understand your brand, focus on the core of your mission, follow your passion, talk to lots of people
  21. Starting a business takes three times as long as you think it will

Further support from www.enterprisenation.com and http://www.princes-trust.org.uk/help-for-young-people/support-starting-business

 

Get real

Reviewing Create Special – a new book on entrepreneurship

Writing a book for would-be entrepreneurs is not easy if you care about the people with the business ideas more than your reputation as a writer.

It’s easy to write a book along the lines of ‘if you care enough and want it enough you’ll get there’ and bookshop shelves show that many do – no doubt reflecting the famous-for-15-minutes-talent-show-con that pervades our TVs (ably assisted by series like The Apprentice)

It’s harder to write a book about the reality of starting a business – with all the pain that can inflict – because you risk putting off the very readers you hope will be inspired by your writing to rise above the barriers, reach for the stars, and be the best they can be (see, I’m getting carried away with that sort of bullshit myself).

Yes – passion and self-belief are important ingredients in any business start-up (why else would you put in the necessary slog to give your enterprise the best chance of success?) but it’s certainly not enough.

I come to be writing this review of Create Special by Jim Duffy though my day-job helping young people explore the world of enterprise and to start their own businesses if that’s the route they chose to take. I should declare an interest here – author Jim Duffy founded Entrepreneurial Spark – a network of business start-up incubators powered by [as they say] NatWest Bank around the UK, and I’m pleased and grateful to have access to one of those incubators, in Milton Keynes, for working with some of the young people who may become business owners of the future.

Ultimately, I feel it’s a disservice to anyone with a business idea to pretend that everyone can be successful if they try hard enough. There are able and less able people out there, and there are certainly good and bad business ideas. Even the best people with the best ideas can fail for very good reasons. For young people who lead complicated lives and have more obstacles than most to achieving business success, it’s dangerous to set them up to fail. Equally it’s also unhelpful to dismiss their abilities, as many authority figures have probably done already in their short lives.

So, in reviewing Create Special, I have a particular interest in assessing how well Jim Duffy has walked that tightrope – to balance inspiration and information – and whether this is a book for young people whom the system has failed and sent to the back of the queue.

I’ve already mentioned business bullshit and I think Jim Duffy scores pretty well on that (by which I mean low). As a lifelong bull-fighter against lazy language, I have my ‘red rag words’ – like ‘engage’ and ‘deliver’ which are meaningless without more detail (that then makes them redundant). Another, newer ‘d’ word I dislike is ‘disruptive’ – I think it’s often used to make something (or someone) sound more interesting than it/he/she is – like ‘new’ and ‘exciting’.

Jim Duffy gets as far as page 9 before using ‘disrupt’. I know lots of disruptive young people but you wouldn’t want them behaving like that in your business incubator! Yes – I’m the first to admit I’m a grumpy old pedant when it comes to language and communication.

Another bugbear of mine is the image surrounding entrepreneurs (particularly social entrepreneurs – about whom I’ve written in earlier blogs).  Awards, and not a few TV programmes with self-promoting, young (and often male) presenters are designed to give entrepreneurship (not quite the oldest profession… but one of them) an edgy and, dare I say it, ‘disruptive’ feel. While this is great for attracting young and young-at-heart entrepreneurs to give it a go, we need to guard against raising those false expectations.

While I think Jim Duffy comes close to presenting entrepreneurs as somehow super-human, he redeems himself by suggesting that creativity can be nurtured as well as being bestowed by nature and Channel 4. Also, that once developed, creative skills can be a real asset for navigating life in general as well as the world of business start-ups. I always say that a failed business start-up and the problem-solving skills it develops, can be a great springboard for later life.

In the world of entrepreneurship, case studies abound with the true tales of people who have overcome all sorts of physical and mental disadvantages to achieve business success (often defined as being wealthy beyond belief). And I’m not knocking them; such stories of success in the face of adversity make good copy and give hope to us all.

But whether you measure achievement in £-s-d or in some other way, I suspect that most successful businesses start from positions of relative privilege –  in university settings, in families where business is in the blood, in households where friends and family support – with contacts if not cash – in the early years.

A generalisation perhaps, but when working with young people who have an overlay of disadvantages such that turning up to a business advice session at an agreed time is itself an achievement, that starting point is important. In a section on focus, Jim Duffy suggests readers  could ‘lock yourself away in a remote cottage’ as one way to avoid distractions. Since even having a quiet space at home in which to write a business plan is on a wish-list for some of the young people I know, I’m delighted that Duffy also suggests you can shut the door to your study [or bedroom, or kitchen?] He also makes the case for having a notebook (and not necessarily one of the Mac variety…)  in which to write the right kind of #GoDo to-do lists; high-tech is not always best.

They say that parents should give their children ‘roots to grow and wings to fly’ and I think that in Create Special Jim Duffy just about gets the right balance between information for growing and inspiration for flying.  I regret that I came to entrepreneurship, and the creativity and problem-solving skills that places like Jim Duffy and NatWest’s Entrepreneurial Spark can unlock, relatively late in life. But it’s never too late to start – go create!

If you order a copy of Create Special online from Hive, you also support high street bookshops… http://www.hive.co.uk/Product/Jim-Duffy/Create-Special–Think-and-Act-Like-an-Entrepreneur-to-Change-Your-Life/20820428

On social entrepreneurs  https://enterpriseessentials.wordpress.com/2013/12/21/slowing-the-spin-about-social-entrepreneurs

Half way between home and work

EggsThis is a shameless plug for business incubators (an alternative family home for lonesome entrepreneurs) in general, and one in particular.

Ten months ago I wrote about my competition success – winning free desk space and business support in the Wenta Group’s My Incubator in Stevenage. For a recent presentation at Stevenage Borough Council I was reflecting on my two days a week at the Incubator; these are my thoughts.

I’m probably not a typical incubator client – ours’ is an aspiring social enterprise and we’re decidedly low-tech. In Stevenage, I seem to be surrounded by people talking software development, apps and gadgets, while our tea-break chat at The Repair Shed in Hemel Hempstead is more likely to be around the merits of different power saws and multi-meters than anything beginning with i- (phone, pod, player etc)

The Repair Shed is one of 130 Men’s Sheds across the UK but is the first, and currently only, Men’s Shed in Hertfordshire. In Australia, where there are nearly 1,000 Men’s Sheds, they describe them as ‘half way between work and home’; easing the transition to life beyond paid employment.

For me, Wenta’s incubator in Stevenage is literally and metaphorically half way between home and work; The Repair Shed being in the opposite corner of the county from my home. My arrival there coincided with a personal decision ‘to be more businesslike’ about my social enterprise development effort. The friendly but professional working environment helps my self-discipline and focus and, of course, there’s the benefit of being surrounded by other business start-ups.

Interest in my expressed passion for making products from reclaimed materials has resulted in welcome tip-offs about local sources of wooden pallets from fellow incubatees (or whatever the word is… maybe I should just call them good eggs). The value of unplanned exchanges while making coffee is much talked-up in start-up circles, but it’s true, as is the sociability of staff and clients alike. As regular readers of this blog will know, I’m a great advocate of peer support.

As someone with twelve years experience in supporting social enterprise development (I’ve even got a qualification to do it) I probably make less use of Wenta’s business face-to-face and online business support than most.

But that said, I think I really should make more of what’s on offer in the building. Online sales is one area I need to beef-up my knowledge for our burgeoning range of upcycled Repair Shed products for home and garden – see https://enterpriseessentials.wordpress.com/repair-shed-shop-2. Thank you Wenta – all help is appreciated. Plugs over.

If you missed the original blog on my ‘big win’ go to  https://enterpriseessentials.wordpress.com/2014/05/20/winning-workspace

See the new Repair Shed film clip at https://www.youtube.com/watch?v=e2rePQDBjWg&feature=youtu.be and find out more about Wenta at http://wenta.co.uk/file/annual-review-2013-14-final-pdf (Repair Shed profile page 8!)

The double shift of the start-up entrepreneur

If you’re starting a new enterprise, are you clear about the difference between working ‘on the business’ and working ‘in the business’?

This has been a hot topic at our problem-solving action learning set sessions at the Lloyds Bank Start-up programme at the School for Social Entrepreneurs in Ipswich. It manifests itself in different challenges.

Since few people have the luxury of working full time on their start-up business, there’s the division of time and energy on the paid-for work and on developing the would-be enterprise. Assuming we’re talking about a six or seven day working week, you’ll find that social enterprise development is worryingly-often squeezed into evenings and weekends (to compete with childcare and other domestic duties). Commitment to make the world a better place can make us the hardest of taskmasters.

The two areas of work may be quite separate or complementary. On the face of it, having overlapping areas of paid and unpaid work may seem like a good thing – working in one domain helping the other – but this brings with it other issues. What if, down the line, you hope your current clients will buy from your new social enterprise? Or maybe your current employer/line manager might be a future customer or competitor? Murmurs about conflicts of interest and accusations of double-dealing, however unjustified, may circulate.

And if you’re starting a business and need to go looking for a part-time job to pay the bills, another issue is whether recruiters think you’ll be using their time to develop your start-up. The interview panel could never admit to such discrimination but the unspoken suspicion may remain and harm your chances of getting a job offer. One answer is not to mention your ‘other business’ (could be tricky…) but if you do, how do you convince the would-be employers of complete separation between the two ‘shifts’?

The core of the discussion is about how soon you might expect to take money out of the business to pay yourself and, ultimately, be able to leave the financial security of your current employment. Unless you have unlimited savings (and even this is not without its problems…) or a start-up subsidy of some kind, you may have to work the double-shift – bill-paying work and business-development – for years rather than months.

In a great blog about start-up for social entrepreneurs, Lynn Sarafinn suggests that seeing your company’s income as your salary is a mistake “You are one part of the ‘machine’ that makes your business work. You are not an employee but the CEO; you have to steer and nurture the business. The income from the business is for the company first. Your salary might not come for a long time.”

Another issue for me (and perhaps others?) is that I find working ‘in the business’ much more fun than some of the necessary drudge associated with developing it. I’m setting up The Repair Shed because I would have loved to have had something like it around when I was unemployed.

IMG_5073I love making stuff (and now call it ‘product development’!) I’ve just finished making a second product – a patio palletable (see photo) – having just sold one of our first, a pallet pub. When I’m designing and making furniture (it used to be beds, now it’s pallet furniture) I experience ‘flow’ – a total absorption in what I’m doing to the exclusion of everything else, including food and the passing of time. I simply don’t get that with any aspect of business development; the only other activities that give me a comparable mental state are cross-country running and singing in a choir.

I know I’m going to have to work until I drop; a career in the not-for-private-profit is not a route to later-life travel and golf, as many will know. The sooner I can get someone else to start a Repair Shed that I can join as a member, rather than an entrepreneur, the better.

Read Lynn Serafinn’s blog at http://bit.ly/VslZBh