Since I have been self-employed for 6 years I often get calls from friends who want to run their ideas past me. Typically the ideas are really great ideas but to execute the Business ideas would take either huge financial risk or they would take too much time to execute in reality.
My general advice is to always start small for as little money as possible, no matter what the idea is. With technology today it is easy to test an idea with a real audience to see who would buy your “million dollar” product or service. You can build a website in 10 minutes and place Google Adwords ads to get traffic to the idea site based on keywords your potential clients would use.
You don’t even need the idea to be complete before you test it. Isn’t the Internet great?
But Won’t Someone Steal My Idea?
The short answer is NO. If you are testing a market that no one else has tapped then your idea may not be that great. And your target market is not interested in making their own business, they found your website to buy a solution to a problem you may have.
If someone does “steal” your million dollar idea so what? There are billions of people in the world and people love choices. Your way of solving the problem will be better in some areas than your competition. And competition is good.
How to Test Your Business Idea For Dirt Cheap
Whether you have a product or a service you need to test the market. You can do this for just a couple hundred dollars to see if your business will get any clients. Get your client base first, then create the product or service.
If your business is a local service business (free)
- Place a free local ad on CraigsList under the Services section
- Wait for a phone call from your potential clients
- Once you get a few clients you will know if your business is sustainable. At this point you should build a website and start paying for advertising with the money you earned from your first few clients
- Grow your business organically and use profits to upgrade your business
If your idea is a web-based business ($2-500 depending on ad spending)
- Build a WordPress site (Learn how to do this in just a few minutes)
- Write a page about your new business and what it will do
- Install a simple landing page theme with a contact form and use this page to generate leads
- Make sure you have a contact information for your potential clients to contact you
- Setup a Google Adwords account and start getting target traffic
- Once you have tested the response to your product and have a list of potential buyers then you can spend some money on developing your web-based business
- Get customer feedback and build your business based on their needs, keeping the potential clients engaged through email newsletters and updates
If your business is a product that requires manufacturing ($200)
- Build a simple diagram or create a prototype
- Submit your idea to a company that will help you evaluate the market like Lambert and Lambert. It costs about $199 but well worth it to research the idea
- If it is viable then sell the licensing of the product for royalties or find someone to back you financially
If your idea will cost millions of dollars to execute or will take years of your life to complete
- Find a cheaper idea like a web-based business to start building passive income
- Use the passive income to invest in your million dollar idea
– or –
- Start a Kickstarter or other crowd sourcing campaign to test the market, gain clients and get startup capital
Most People Don’t Act on Their Business Ideas
The fear of failure is the main reason why people don’t start businesses. The world is against you and your big idea. How many times have you heard some statistic like 85% of new business fail in the first 5 years? Who cares!
What they don’t tell you about are the follow-up business people start after their failures.Let’s say your new business runs successfully for four years and then it falls apart. Then what? Imagine how much experience you gained from taking your business from idea to successful business to the point of failure. That journey will give you more experience than you got in college for 4 years! And you were getting paid for most of that time and hopefully recouped your investment.
If you start small and build a profitable business with little or no debt you are more likely to succeed. If you cash in your 401k and take out a home-equity loan to start an unproven business, then you made a mistake from the beginning.
Always start as small and cheap as possible. Get clients and cash flow and reinvest. Your odds of failing then are minimal.
Get Back on That Horse
I am not saying that you should expect failure, but if you do fail you should try again! Take the mistakes from the failed business and use them to make a better business.
Don’t listen to the nay-sayers. The people who try to discourage you are usually the ones who have never acted on their business ideas. They are stuck and discouraging you only gives them another excuse not to try their own Business ideas.
Don’t Quit Your Day Job
If you are reading this blog then you are probably looking for answers on how to build an online business to replace your current job. You feel “stuck” at your job and want to work for yourself from home. Don’t quit your day job yet!
Your new business idea can be tested and developed while you keep the income from your current job. I recommend you make your business sustainable for at least a year. Only leave your job after your business net income exceeds your current salary.
In the meantime, use the extra income from your business to re-invest in the business. By the time you are ready to leave your job you will probably be making way more than your current job. In your spare time! Essentially you are letting your employer pay for your business start-up costs through your salary.
Find Real World Examples of Success (and failure)
During the idea phase you will need motivation and guidance. There are many blogs like this one where people track their passive web-based income online. Track my profit and loss here.
Here are a few other blogs I recommend for this purpose:
Share Your Experience and Business Ideas Here
Do you have experience or questions about getting your idea off the ground? Did you have a failed business and then started a new, more successful business after failure? Or maybe you started a business for dirt cheap that is now your livelihood. If so please share in the comments section below.