Are you wondering what are the signs you‘ve chosen the right business idea?
There are billions of potential business ideas and variations of them. Not all end up being truly viable as a business. For others, it is a good idea, but the world just isn’t ready for it yet. Some are truly terrible and not researched and vetted nearly well enough in advance.
Genius business idea or not, you can expect there to be challenged. Even with the best idea, there will be challenges along the way. Even daily. The product, go to market, and expansion plans may all need ongoing tweaking, pivoting, and reinvention. Even the best businesses often come dangerously close to bankruptcy.
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So, how do you know if it is time to fold, or if you’ve really chosen the right business idea and should keep going all-in?
People Want To Help And Be Involved
Great businesses and business ideas are magnetic. People want to be involved. As you share your idea, raise awareness, and spread your idea, people will want to help you. They will want to participate in some way.
They will engage with you online and even reach out to you via social. Advisors will want to help advance your ideas. Others may lend resources or offer discounts or creative arrangements to get you going.
You Get Paying Customers
A truly great and viable business idea is one that gets paying customers. This is one of the critical signs you‘ve chosen the right business idea.
All the theoretical yeses and comments and Facebook likes are meaningless unless there are real paying customers. You might even argue that in many cases free and trial plan users are also meaningless or just a costly luxury if the company relies on revenues from paying customers.
This doesn’t mean that there won’t be a need to iterate, pivot, and tweak products, service and marketing, and even rebrand. You may get to a point where what worked to get you here, isn’t the right or viable marketing strategy and benefit set to carry you forward.
Make sure you can differentiate between a good business idea and everything else that goes into evolving and spreading it.
People Are Sharing Your Business Idea Voluntarily
No matter how great the business idea and product, you can still expect to work hard and invest heavily in marketing and branding. You need to raise awareness, educate, nurture and sell. This is an ongoing need, even for the largest multi-billion dollar hit brands that have been around for decades.
Yet, a great business, brand, and product will also gain a lot of organic sharing as a result of those investments and efforts. People will voluntarily share with you and recommend you and this is something to keep in mind as part of the signs you‘ve chosen the right business idea.
This may be a simple word of mouth mentions. Or it could be reposting you on social media, active referrals, or even writing and publishing articles and blogs about you.
Lower Customer Acquisition Costs
Great business ideas that are presented in their best possible way will benefit from lower customer acquisition costs.
No matter what your acquisition channels and strategies are, they will have lower costs than an inferior business, brand, and product which is like trying to squeeze a square peg in a round hole.
Your ratio of in-person sales conversions will be higher. Your social and PPC ads will enjoy better conversion rates. You’ll get more results from content marketing.
Your Company Is Growing
Traction and growth is the best indicator you are on track with a successful business idea. This is key when wondering about the signs you‘ve chosen the right business idea.
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If you aren’t growing you’ve hit a wall and are sliding into the abyss. That may be reversible. Though it is at least a huge warning that immediate action is needed.
There are many ways to measure and report growth. Some are better indicators than others. Some are more accurate, versus those which are more easily manipulated and hacked in unsustainable ways.
Some of the growth metrics to watch may include sales volume in units, new customers acquired, revenues, profits and profit margins, revenues per employee, and more.
The earliest stage startups may be evaluated on a week over week growth. Later that can extend to month over month, then quarterly and annual growth.
Just keep differentiating between bought and earned growth and sustainable, profitable growth versus the unsustainable.
It is true that even the most successful entrepreneurs and businesses today have often had to pitch hard and faced hundreds of turndowns by investors over a period of months and years.
Though if you are up and running, or are at least out there sharing your business, inbound inquiries from investors is one of the best signs that you have chosen the right business idea.
In this regard, keep in mind that in fundraising storytelling is everything. In this regard for a winning pitch deck to help you here, take a look at the template created by Silicon Valley legend, Peter Thiel (see it here) that I recently covered. Thiel was the first angel investor in Facebook with a $500K check that turned into more than $1 billion in cash.
Remember to unlock the pitch deck template that is being used by founders around the world to raise millions below.
People Want To Work For You
If you’ve got it right, people won’t just want to buy from you, tell their friends about you and invest in you, they’ll want to work for you too.
They will want to work with you or for you, if they are passionate about the vision and mission, are inspired by your why love what you are solving and the values your brand stands for, and want to align themselves with your success.
This happens as well with investors. They are jumping in to help you in building the business. It is all about the future and possibility. Below you will be able to find a video where I cover in detail how to prepare investor meetings.
The Competition Is Moving In
One of the most obvious indicators that you are doing things well is that the competition is moving in on you. The doubters and haters are now your biggest competitors. They see what you are doing and want a piece of the pie.
This can and will eventually include both giant corporate competitors who are better funded, established, and have bigger budgets and teams, as well as new small startups and entrepreneurs who think they can move faster and cheaper than you.
Hopefully, this post provided you with some insights as you are thinking about the signs you‘ve chosen the right business idea.
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