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Six Ways to Find a $100 Million Idea and Top Founders' Advice for New Entrepreneurs
Six Ways to Find a $100 Million Idea
Ever wonder how entrepreneurs come up with brilliant business ideas that turn into successful companies? I interviewed 45 company founders, each of whom started, grew, and sold a company for $100 million or more, or took their company public for $300 million or more. Here are some of their secrets.
1. Fulfill their need, not your passion.
It's a myth that successful businesspeople got into their field because they cared deeply about it. Success doesn't follow passion, it follows need. Find something that no one's doing that somebody should do. That's what Dick Costolo, founder of Feedburner, did when he saw that publishers had content but no way to distribute it online to subscribers and syndicators.
2. Identify your customer's big problem.
Where there's a meaningful problem, there's a reason to solve it. Cardiologist Donald C. Harrison came up with the idea for his medical device company AtriCure after asking himself how he could make a novel contribution that would help his heart patients in a major way.
3. Get it from your hands, not your head.
How did a guy with a degree in supercomputing end up in the trucking biz? Internet Explorer billionaire Tim Krauskopf got the idea for a transportation technologies startup, FreightZone, after he learned to drive a semi and began to experience what was involved in the trucking industry.
4. Put your heads together.
Often, $100 million ideas come from collaboration. Rock Mackie knew Tomotherapy was a viable concept only after three of his graduate students each made separate and important discoveries. Put together, his team's ideas resulted in a new and remarkably better CT scanning technology for treating disease.
5. Make it sellable and fixable.
Do you think you have a great idea for a new product? It's not a great idea until you've gotten involved in selling it. Jim Dolan of the Dolan Company advises that selling is the quickest way to find out what's wrong with your product idea so you can fix it quickly and move on. If you can't sell it, don't make it.
6. Get help developing it.
Serial entrepreneur Mahendra Vora, who's launched more than a dozen highly successful tech companies, warns would-be entrepreneurs not to be narcissistic about their idea. Instead, develop 60 percent of your vision, put it into the hands of trusted customers, and let them help with the remaining 40 percent of the idea.
Top Founders' Advice for New Entrepreneurs
Want to know how some of America's most successful entrepreneurs made it? Here are some jolts of inspiration and shots of courage for new business owners, gleaned from interviews with 45 of America's leading company founders.
Too little funding forces discipline.
The upside of having too little funding is that your business can grow organically, and you'll stay very focused on making a profit and positive cash flow.
Always have a standby investor.
No matter how much you like each other, and how much time and effort you've invested in negotiating and paperwork, large financial partnerships can -- and often do -- fall apart last minute.
Create a business plan that's a selling tool.
Venture capitalists look at hundreds of prospects, so your business plan has to be clear, credible, and able to demonstrate in 10 minutes or less your dedication to solving a crucial problem.
Be honest in all your dealings.
Running a business is no different than running your life. Founders should be honest in their dealings and in their assessments. Always look at facts, because facts don't lie.
Start with what you have.
If you wait for the perfect solution to come along, you'll never get your business going. Assume that the right tools, systems, and people will come along to refine it.
Make your employees shareholders.
When employees have a sense of ownership, it creates a kind of self-enforcement process. Give stock options to everyone at your company -- all the way to the janitor. Owners think differently than employees.
What doesn't work, throw away, and what does work, run with it. Knowing what's going right and what's going wrong -- and doing something about it quickly -- will put you at the front of the class.
Be willing to tweak your idea.
If you fall too much in love with your idea, you won't have the capacity to take feedback from other people and from the market. The idea you start with is unlikely to be the exact idea you're going to win with.
Many more articles in Creativity & Innovation in The CEO Refresher Archives