Insights, Innovation and Entrepreneurship

  • Ideas, what the hell do I do with them

    It starts with a safe

    Safe

     

    Well, you store them of course.

    You buy a big fat safe, and you start piling them up in the safe, until I come over, and give you 100$ for each one of them and then you retire.

    But, until I do come over to buy all those ideas, there’s something you have to do with them.

    An idea’s worth

    An idea is an odd thing, it’s a thought that sprung in your head, and you hoping it will grow wings and manifest itself to a beautiful butterfly (poetic-intended).

    Ideas are cheap, I would say the average idea costs 1$. 0.1$ for a lousy one, and 10$ for a very good one.

    It doesn’t really matter how I do my math, but I proved that anyone can come up with ideas, and if I got you incentivized enough (100$ per idea) you could retire just from making up ideas.

    So, if ideas are worthless, what’s the point?

    The point is the manifestation. An idea in your head or in your safe will not change anything. Ideas are meant to be executed or to be executed (pun-intended).

    Executing ideas

    Beheading

    Before you start running and taking people heads off, you must determine if an idea is worthwhile.

    So, we will delay our execution for now.

    Evaluating Ideas

    You evaluate an idea to determine if to go forward with it.

    Ideas can be very different from one another, and can be evaluated in different ways, but most ideas these days can be evaluated as follows (apologies for the length of text below, but I intend to provide you with real tools to work with):

    Investigate

    Try getting as much people as you know to hear your idea and start performing an investigative process with them:

    1. Would you use that product?
    2. If not, why not?
    3. Would you pay 10$ for it?
    4. Do you know other people that might be interested in it?
    5. Would you use it on your mobile?

    The point of this step is to refine your idea or throw it away, after doing a few of these “investigations”, your idea will either start to feel like it sucks, and you should throw it, or it will feel like it has potential, and you should refine it around the edges. Be true to yourself while doing these investigations.

    Find competitors

    If an idea has no competitors it usually means there’s something broken with it. A lot of smart people like you think of ideas, every day thousands of applications, games and websites go online, that have people behind them that thought they will be successful.

    If nobody executed something that is similar to what you are attempting, then there is a problem with it. Competitors shouldn’t scare you off, you need to learn from them (are they successful? What are they doing well? What are they doing badly? How much are they making? Can I do something better than them?)

    Follow the money

    Start an excel spreadsheet, open google and start estimating your market and have a vibe on the business plan.

    What I mean by that step is that we need to put some numbers behind what you are trying to do, and I think the best way I can articulate how, is give you an example:

    I have an idea for a gestures application for your mobile, so that when you drive you don’t need to touch your phone to answer calls (you use “Waves” from 0.5M away from the phone, and I use the front camera to pick up these “Waves”). Here’s what I’m going to do to put some numbers:

    1. I will find how much users successful “gestures”/”voice commands” applications have in the Android market (easier than iPhone), but they must be similar to what I’m doing. I saw that some good ones have 100-500K users.
    2. I will estimate how much the maximum amount a user will pay for that application over his life time (either via ads, direct payment, inner-purchases), let’s say 0.2$
    3. Now I can estimate that the app I am making will make me a maximum of 2 (iPhone + Android) * 0.2$ (per user) * 500K = 200K$

    Bear in mind, the numbers in the excel are there to give you a rough feeling on how much this venture is going to give back to you if it is successful. It is very easy to cheat yourself on this stage (pick the most successful application, say to yourself that you will do much better than the successful ones), get a reality check with someone else looking at the numbers, show them how you deducted your calculations, back the numbers with facts (e.g. the average mobile user life time value for an adventure game is XXX$).

    By now you have dissected your idea pretty well, you got a vibe from it, and you can either decide to “promote” it, or throw it to the trash can.

    Good ideas are those that got promoted enough so that they are viable enough. It’s a killing field for ideas, they get slaughtered every day, that’s why you have to keep restocking your safe, and keep promoting good ideas that you have evaluated.

    Word of caution

    It is easy to start being overly pessimistic and just dismiss any idea that comes along in this approach, you must find the middle ground, as we said – the execution is the most important thing, so you might think of a silly idea that has tons of competitors (e.g. “To Do” application for mobile) has no chance, but if you execute well (“AnyDo”), then you might get your market share and be successful.

     

     

    In the end, you should have at least 1 idea that you feel is your “prime” idea, that got evaluated enough, and you are ready to execute.