The web is plenty of articles and resources on how to start a business and how to make money. However, there is an issue. Those resources give you plenty of advice and give you many options.
But a few help you start a business you’d be for the long term. Indeed, building up a business from scratch isn’t a simple task. Quite the opposite, It is a rollercoaster, which if you’re lucky it will take five to ten years to take off.
Thus it is critical that you not only start a business with great potential. But that you’ll also love what you’ll be working on and the problem you will try to solve. Therefore, finding a successful business idea means three primary things. It starts with solving a problem but then figuring out whether:
- That is something you like
- Something that you’re good at
- And that you can be paid to do
For that matter, the Bud Caddell’s diagram helps us in finding the sweet spot between these three key elements. If you do find yourself within that sweet spot, you can say you’re going after the right business idea and that you’re ready to become an entrepreneur.
Start with the problem in mind
One of the biases that that many entrepreneurs fall run into is this premature love of the solution. Like the first principles in science, you almost have to deconstruct an idea. We have to start with the basics. In this case, when we look at our business, we have to break it down into customers and problems.
He calls this problem/solution fit.
Create your lean canvas
While this is an incredible tool, it focuses on how to get there.
Before you start using this incredible tool, you need to answer three primary questions.
Is this a problem I want to solve?
For most entrepreneurs, business is not a matter of choice, but rather an opportunity. However, in today’s world, where barriers to entry have become very low (digital businesses can be created relatively quickly and with meager investment), the competition is fierce.
Thus, endurance has become a critical element. And to make it through your business you need to love the problem enough to keep going for at least five to ten years.
Am I good at it?
As competition is fierce, it is critical that the solution you offer bring value to the table. For instance, when Brin and Page launched Google (initially called BackRub), it was argued that it was 10X better than any other search engine out there.
However, the Brin and Page not only fell in love with the problem of indexing and ranking a whole web (which at the time was way smaller than it is today) but they were pretty good at it (Google was born as result of their thesis as P.h.Ds).
Can I be paid for that?
As we’ve seen to make a digital business take off so that you reach the so-called ramen profitability, it might take a few years. And if you don’t like or love the company you’re after it is very hard that the business itself will be successful. That’s because you’ll hardly have the willingness to put through the hard times.
Starting a digital business, today has become fairly quickly. However, starting and growing a successful business is as hard as ever. That’s because, with the advent of the web, the barriers to entry have been lowered and pretty much anyone can test its entrepreneurial skills.
However, this also generates the confusion that you can build a business very quickly. However, to build a successful business from scratch, it might well take five to ten years of struggle. Therefore to understand if you are up to this struggle, you need to answer three basic questions:
- Is this something I like (love)?
- Am I good at it?
- Can I get paid for it?
If you’re able to find the sweet spot, you’re ready to start!
- The Importance of Finding the Right Business Idea: Starting a business from scratch is a challenging and time-consuming process. To ensure long-term success, it is crucial to find a business idea that not only solves a problem but also aligns with your passions, skills, and potential for profitability.
- Bud Caddell’s Sweet Spot: The Bud Caddell diagram helps entrepreneurs find the sweet spot between three key elements: solving a problem they love, something they are good at, and something they can be paid to do. Being within this sweet spot indicates that you have found the right business idea to pursue as an entrepreneur.
- Problem/Solution Fit: Ash Maurya, the author of Running Lean and Scaling Lean, emphasizes the importance of focusing on the problem before jumping to the solution. It’s essential to deconstruct ideas and analyze the potential customer problems that the business aims to address.
- Use the Lean Startup Canvas: The Lean Startup Canvas, developed by Ash Maurya, is a valuable tool to help entrepreneurs clarify their business ideas on one page. However, before using this tool, you must answer three critical questions to assess the viability of your business idea.
- Endurance and Passion: In today’s competitive business landscape, endurance and passion are vital for long-term success. Loving the problem you are solving will keep you motivated to overcome challenges and sustain your business for five to ten years.
- Value Creation: For your business idea to succeed, it must bring value to the table. Being good at solving the problem and offering a solution that stands out in the market are essential components of value creation.
- Monetization Strategy: A viable business model must have a clear monetization strategy or profit formula. Achieving ramen profitability, where your startup makes enough to cover founders’ living expenses, is an important milestone in the early stages.
- The Reality of Building a Successful Business: While digital businesses can be started relatively quickly, building a successful business takes time and effort. It’s important to recognize that success might not come overnight, and the journey may involve several years of struggle and perseverance.
Three Basic Questions to Determine Business Viability:
- Is this something you love and are passionate about?
- Are you skilled and proficient in addressing the problem?
- Can you develop a scalable and repeatable monetization strategy for the business?
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