Entrepreneurship 101: That First Spark

Lesson 2: That First Spark

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That First Spark

Every business starts with an idea of a service or product. This idea offers a unique solution to a common problemYour idea must not only be creative, but “commercially viable.” This simply means that it can make you money.

One way to get feedback is through family and friends. Ask for their honest opinions. They can give you encouragement—or a reality check. Either way, considering both positive and negative input is a good place to start.

 Your personal network is an excellent resource. Maybe you could send out a survey, or interview volunteers; the answers you get might surprise you! 

The Validation Process

Evaluating your idea is known as validation. While this process might have other steps later on, like pitching your idea or testing your product, ask yourself these five key questions:

  1. Who will be your main customers? Put yourself in their shoes. Think about their social, emotional, or professional needs, and how your idea could be useful to their lives. This is really important, since the growth of your customer base will be directly tied to the growth of your business.
  2. How will you distribute your product or service? Are you mainly interested in selling locally, or do you want to reach a wider audience? Maybe you offer a digital service sold online, or a physical product handed to the customer. Try to envision the distribution process.
  3. What is its potential value? Successful entrepreneurs take a “human-centered” approach; in other words, they put the consumers first. They understand that the demand for something will drive their profits. Basically, it’s the buyer who determines the value.
  4. Who is your competition? These are the companies or people who offer similar products or services. Knowing who they are—and why they are successful—will help you to figure out how to stand out in the marketplace.
  5. What resources will you need? Depending on the size of your business, you might need to find key partners, like a supplier or manufacturer. There are physical resources to consider, like inventory and real estate, and human resources, like staff. And, of course, you need money!

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