Issue 26

June 24, 2024

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How to Pick a Business Idea

I’ve worked on countless side projects before. Some I’ve done for fun and others I’ve done for business. The truth is I never finished most of them. And that’s partly because I didn’t spend time evaluating the idea before I started.

It’s easy to analyze a potential business idea from one side only. How much money can I make? What skills do I need? How long will it take me to build it? These are great questions and their answers should be combined to help you make a decision.

I want to share three different methods you can use to help you select the right idea. The best way to approach the selection phase is from all sides. This will give you a clear picture of the idea and allow you to make the best choice you can.

Use the Ikigai diagram

Ikigai is a Japanese term that means “a reason for being.” Ikigai is often referenced in articles about careers and entrepreneurship. The diagram can help you categorize your ideas.

What I love about the diagram is that you can easily visualize how the different circles overlap. You can also better understand how passions, missions, vocations, and professions are formed.

Use the diagram above. Place your side project and business ideas into the different segments. This will give you a sense of how close (or far) your ideas are from Ikigai.

Don’t worry if some of your ideas don’t overlap with one of the circles. It’s not about picking the perfect idea. It’s about picking the right idea for you.

Crunch the numbers

There is a wealth of knowledge on the Internet. If you know the right places to look, you can find valuable research to help you pick an idea.

Searches and sizes

You can use Google Trends to see what people are searching for. Enter keywords related to your ideas and see what the trends look like. If the trend is down, you might want to consider another idea.

You can also take a look at market sizes for your target audience. If you’re building a tool for Product Managers, you might want to find out how many Product Managers work in the US. Facebook’s ad platform exposes some market-size data that can help with this.

Some federal bureaus and organizations track and collect similar information. This can help you figure out how many people your business or product could potentially reach.

For more on this, I recommend The Million Dollar Weekend by Noah Kagan.

Social media posts

Another way to crunch the numbers on an idea is to look at social media posts.

Let’s say you want to write a parenting book about teens using smartphones. You can go to a parenting subreddit on Reddit and search for “teens and smartphones.” This will show you how many posts include your keywords. Are there 10, 1,000, or 10,000 posts in the past year? Like Google Trends, this can give you a sense of how popular the topic is.

Last week I mentioned how you can use Reddit to find problems. The added benefit of doing this is that you can directly message posters and learn more from them. And you never know where that conversation can lead. It could help you decide on an idea.

Focus on skills and scalability

It’s a whole lot easier to do something when you’ve done it before. Everyone has skills, knowledge, and experience. When you combine all three, you increase your chances of success.

If you enjoy writing, think about selecting an idea that involves writing. If you’re a software engineer during the day, consider building an app on the side. If you love to cook and create new recipes, maybe you can create a digital course on cooking.

Beyond your current skill set, you should also think about how scalable your idea is. Some ideas are easier to break down and scale up over time. The reality is that you have to go from 0 to 1 before you can go from 1 to 10.

A scalable idea will also help you get to MVP (minimum viable product) faster. Can you create something in a week? How about a month? Avoid picking an idea that will take you months to get off the ground. The faster you can build something, the faster you can validate it.

By now I hope you’ve learned that there’s more than one way to consider an idea. You can see if it aligns with your passions and skills. You can measure it against existing products and trends. And you can figure out how quickly you can get started on it.

There is no perfect way to select an idea. You can look at ideas through different lenses, but at the end of the day, you have to make a choice.

The good news is that if you make the wrong selection, you can always select another idea. In the final part of this series, I’ll share a couple of ways you can validate your idea. And once you learn that, it will make the selection process even easier.

Thanks for reading this week. See you next week! 👋

David Weiss Founder • Made by DW ​Follow me on X, LinkedIn, & Instagram​

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