The best way to come up with good ideas for a new startup or product is to identify your own problems or needs and then conceptualize an innovative solution for them.
This opinion is not only held by the well-known founder of Y Combinator, Paul Graham. Many successful companies like Airbnb, Google, or Instagram are also based on this principle.
I can fully confirm this from my own experience, as my first successful product also originated from a personal need. In 2004, I had just completed my technical studies with a focus on Multimedia Arts (Media Informatics). Since I was also very interested in entrepreneurship and digital business models, I wanted to pursue an MBA degree as well.
The search for suitable programs proved to be difficult. At that time, there was no portal with sufficient information, and there was a lack of a comprehensive search with appropriate criteria to find suitable programs. Therefore, I attended various fairs, read articles, compared MBA rankings in specialized journals, and conducted interviews with universities.
I wanted to share this knowledge with others and documented my collected experiences on the website mba-studium.net, which after a few months and successful SEO measures, ranked first on Google for the keyword MBA. Initially, the site was purely an editorial portal, but later I developed additional features, such as a search function for MBA programs.
From the need
“I want to find a suitable MBA program in Europe with AACSB accreditation and a maximum cost of €35,000.”
and problem
“There is no structured overview of all MBA programs in Europe with suitable filter criteria.”
a solution emerged
"An extensive guide portal with an integrated search function for all MBA programs with filterable criteria."
including a business model
"Referral of students to universities"
and market access via
"Search engines (demand, supply) and mailings (supply)."
Meanwhile, the rather inconspicuous and niche-specific portal mba-studium.net has mediated thousands of contacts to universities since its founding and has generated more than 1 million in revenue.
Not every idea has to or can start from scratch. Established companies with successful business models regularly seek new ideas and innovations.
Although directly solving one's own problem/need is a very good way, in my opinion, it is not the only source for successful business ideas and products.
Founders and entrepreneurs should also consider taking other perspectives, such as those of their own customers or acquaintances/business partners with specific knowledge and challenges in a completely different industry.
The following methods can help in gathering ideas:
Problem analysis is a systematic method for identifying and examining specific problems to find potential solutions. This approach often involves collecting data through observation, interviews, and surveys to gain a deep understanding of the challenges faced by the target group. By focusing on real problems, innovative and practical solutions can be developed.
An example is mba-studium.net. A more abstract example could be an entrepreneur observing that more and more people in urban areas are having trouble finding affordable housing. After talking to potential tenants and landlords, he develops a platform that allows subletting of vacant apartments to use housing more efficiently.
High
Customer feedback involves collecting and analyzing feedback and opinions from existing or potential customers. This can be done through surveys, interviews, focus groups, or online reviews. By understanding customer needs and expectations, companies can develop or improve products and services that meet user requirements.
A company that manufactures fitness equipment collects feedback from users of its current products through surveys and online reviews. Many customers express the desire for a portable fitness device that is easy to use and provides comprehensive health data. Based on this feedback, the company develops a new portable fitness tracker that measures heart rate, sleep patterns, steps, and calorie consumption. The tracker is connected to a user-friendly app that provides personalized health tips and training plans.
High
Brainstorming is a creative method where a group of people gathers ideas in an open and free environment. The goal is to generate as many ideas as possible in a short time without evaluating them immediately. This method promotes creativity and allows a variety of solution approaches to be developed.
A team of founders and creative minds meets to develop new business ideas in the field of sustainable consumer goods. During the brainstorming session, the goal is to collect as many ideas as possible without evaluating or criticizing them immediately.
Medium
Market research involves the systematic collection, analysis, and interpretation of data about markets and consumers. This method uses techniques such as surveys, focus groups, interviews, and sales data analysis to gain insights into the needs, preferences, and behaviors of target groups. The results of market research can be used to make informed decisions about product development and marketing strategies.
A technology company conducts comprehensive market research using surveys, focus groups, and interviews to understand consumer needs in the smart home sector. The data shows that users are dissatisfied with the complexity and lack of interoperability of their smart home devices. Based on these insights, the company develops a user-friendly app that seamlessly controls and manages all smart home devices from different brands. A prototype of the app is created and distributed to test users to gather further feedback and optimize the product.
Medium
Design Thinking is a user-centered innovation approach that combines empathy, ideation, and prototyping. The process begins with identifying and deeply understanding user needs and problems, followed by developing and testing prototypes to create creative and effective solutions. Design Thinking emphasizes iterative testing and adjustments based on user feedback.
A medical technology company uses Design Thinking to develop a new portable ECG device. Through interviews and observations of patients and doctors, the team identifies that user-friendliness and mobility are central needs. Several prototypes are developed and continuously improved in iterative tests with users until the final product meets these needs optimally.
High
Trend observation involves systematically observing and analyzing current trends in various industries. By recognizing and understanding trends, companies can identify new business opportunities and adapt to future market changes. This method uses sources such as market reports, trend analyses, social media, and expert opinions.
A food company observes the growing trend towards plant-based nutrition and analyzes market data as well as consumer opinions on social media. Based on these insights, the company develops a new product line of plant-based meat alternatives to meet the increasing demand for environmentally friendly and healthy nutrition options.
Medium
Mind Mapping is a visual technique for representing and structuring ideas. A central concept is placed in the middle of a diagram and connected to related ideas and sub-concepts. This method promotes creativity and structured thinking by allowing complex information and their relationships to be captured at a glance.
A startup team uses Mind Mapping to develop new business ideas in the field of sustainable products. In the middle of the diagram is "Sustainability," and from there, subcategories such as "Recycling," "Energy Efficiency," "Biodegradable Materials," and "Local Production" branch out. This structure helps the team develop creative and innovative business models that focus on different aspects of sustainability.
Medium
Reverse Engineering involves analyzing and dismantling existing products or services to understand their functionality and develop improvements or alternative solutions. This method is often used in the technology sector to achieve innovations and improvements based on existing models.
A technology company disassembles a popular but complex 3D printer model to understand its functionality and design principles. Based on this analysis, the company develops its own 3D printer that is more user-friendly and delivers better print results at a lower price.
Medium
Workshops and hackathons are intensive, collaborative events for idea generation and problem-solving. They bring together experts and participants from various fields to develop innovative solutions within a short time. These events promote teamwork, creativity, and the rapid exchange of ideas.
A technology company organizes a hackathon where developers, designers, and product managers come together to develop new products or services within 48 hours. A team identifies during the hackathon that many small retailers have no simple way to manage online orders. They develop a prototype for a cloud-based platform that allows retailers to efficiently manage their orders, monitor inventory, and directly integrate with delivery services. The prototype is presented at the end of the hackathon and receives positive feedback from potential users and investors, leading to further development and market launch of the product.
Medium
The Blue Ocean Strategy aims to create new markets by generating new demand and differentiating from existing competition. Instead of fighting for market share in the existing market, companies identify untapped areas with little to no competition and create innovative offerings there.
An electronics company realizes that the market for traditional headphones and speakers is highly competitive. Instead of offering another model in this saturated market, the company develops a completely new product category: "sleep headphones." These headphones are specifically designed to be worn while sleeping and offer features such as noise cancellation, soothing sleep music, and sleep monitoring. Since there are currently few products on the market that specifically address the needs of people who have trouble falling asleep, the company creates a new market and can position itself as a market leader.
Medium
Exaptation refers to the use of technologies or concepts from one field to solve problems in another field. This method requires creativity and a broad knowledge of various industries to find unconventional and innovative solutions.
A healthcare company uses a technology originally developed for aerospace to monitor structural damage in aircraft. This technology is modified to develop wearable sensors for
continuous monitoring of chronic wounds in patients. The sensors can measure moisture, temperature, and bacterial growth in the wound, providing doctors and caregivers with real-time data to monitor healing and detect complications early. By adapting this existing technology from a completely different field, the company can offer an innovative solution in healthcare.
Medium
Cross-Industry Innovation involves transferring solutions and approaches from one industry to another. This method uses proven practices and technologies to identify and develop new business opportunities in various industries.
An example of Cross-Industry Innovation in the context of a business idea is the introduction of drone delivery services from the technology and logistics sectors into retail. A startup could use drones to deliver products directly to customers, reducing delivery times and costs. This idea transfers proven technologies from logistics to retail and offers customers a unique, fast, and efficient delivery service.
Medium
In summary, there are very different methods and sources for generating ideas. They all share the goal of achieving close proximity to the market and the needs of potential customers.
When it comes to evaluating business ideas, there are certain criteria that distinguish good ideas from bad ones. Here are some important aspects to consider:
Good ideas are based on solving real problems faced by people. If your idea is based on a real challenge, the likelihood is higher that it will attract interest and be successful. For example, Airbnb solved the problem of expensive hotel stays by allowing individuals to rent out their accommodations.
A successful idea offers a unique value proposition that sets it apart from existing solutions. This value proposition can relate to features, pricing, user-friendliness, or other aspects that provide clear added value to customers. For example, Netflix revolutionized the way people watch movies by offering convenient and cost-effective streaming services.
Good ideas have proven market potential. It is important that there is sufficient demand for the product or service you want to offer. This can be verified through market research and validation tests. Dropbox became popular because it solved the problem of secure and easy file storage, and there was a large demand for this service.
A good business idea should have the potential to grow and scale. This means that the business model must be designed to be efficiently expanded with increasing demand. Facebook began as a network for Harvard students and grew into a global social network serving billions of users.
Timing is a crucial factor for the success of an idea. A good idea at the wrong time can fail, while a timely implemented idea can be successful. An example of this is the introduction of streaming services at the right time when internet speeds increased, and the demand for on-demand content grew.
A good idea should be easy to understand and use. Complex products or services that are difficult to use often struggle to reach a broad user base. Apple products are a good example of this, as they are known for their user-friendliness.
In addition to market demand, it is important that the idea is economically feasible. This includes production costs, pricing, and the potential for profitability. A good idea must be financially viable to be successful in the long term.
Good ideas are often flexible and can be adapted to changes in the market or technological advancements. Companies like Amazon have continuously evolved and adapted their business models to stay successful.
Ideas that do not solve real problems often lack sustainable success. If no one has the problem you are trying to solve, no one will need your product or service. Many failed social media platforms could not address clear user problems and therefore went under.
If your idea does not offer anything new or unique, it will be difficult to stand out from the competition. "Me-too" products that merely copy existing solutions without providing additional value often struggle to attract attention and market share. Simply adding features to existing products is not enough to create a successful business idea.
Bad ideas often arise from a lack of market research. Without knowing if there is actually a demand for your product, you risk investing time and resources in something that finds no customers. Thorough market analysis and estimating market size are crucial to avoid this.
Ideas that are not scalable quickly reach growth limits. If your business model cannot be expanded to meet greater demand or requires too many resources to grow, it will be difficult to achieve long-term success.
Ideas that depend on too many negative variables are often risky. These can include external factors such as regulatory hurdles, market volatility, or economic uncertainties. If an idea depends too much on uncontrollable factors, it can easily fail.
Bad ideas often lack a clearly defined target group or appeal to too many different target groups. Without a clearly focused target group, it is difficult to develop an effective marketing strategy and attract customers.
An idea can only be successful if the founders are passionate and committed. Ideas pursued only for financial reasons, without the founders truly believing in or being passionate about them, have a lower chance of success.
The more time you spend searching for potential ideas, the more important it becomes to collect, filter, and prioritize ideas in a structured manner.
I recommend that founders and product teams set a few initial framework conditions. This may narrow the circle of potential ideas later, but it greatly helps with prioritization.
Here are a few examples of such framework conditions:
Location Independence: The product must be able to be implemented independently of location.
Monthly Recurring Revenue (MRR): At least €100,000 MRR must be achievable.
Market Potential: The idea should have great market potential and a clear target group with more than 10,000 potential customers.
MVP Costs: The MVP must not exceed €100,000 in cost.
For efficient idea management, I recommend using an idea backlog. I have created a sample template for such an idea backlog, which can be downloaded and customized. The template also calculates an initial scoring based on some example criteria.
Good startup ideas solve real problems, preferably problems that the founders themselves have.
Ideas should be based on the actual needs and problems of users.
Ideas that are purely theoretical or hypothetical often lead to failure.
Start with a small group of users who urgently need the product.
Ideas often arise from observing and identifying gaps or problems in everyday life.
Successful startups often develop organically from personal projects or interests.
I hope this article is helpful. I welcome constructive feedback and suggestions for improvement. I wish you much success in searching for new business ideas!
A warm welcome to you! I am Max von der Nahmer. With more than 20 years of experience in digital business models, software development, product management and online marketing, I am happy to support you as a consultant, interim manager, advisory board member and angel investor.
