No matter how many Venture capitalist and angels try to attract with free lunches and dazzling pitches if the basic idea is for you Start up It’s bad, you’ll have a hard time.
This is a sensitive subject. The They are excited about their business. And there is also the question of disruption: Over, Airbnb, Bitcoin, even Amazon in its beginnings. These ideas might have sounded terrible to others at the time.
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Understandably, entrepreneurs are never anxious to tell co-entrepreneurs that their idea sucks. So you have to find out for yourself. Here are four red flags that can indicate a bad investment before you get too involved.
1. It’s an unoriginal idea in a highly competitive field
Accounting is an incredibly difficult business to be successful in in the UK. You should know: One of my companies is a London based accounting firm with over 50 employees. According to the Bureau of National Statistics, there were more than 43,000 accounting firms registered in the UK in 2019. The number continues to grow.
I’ve seen it time and time again: accounting practices fail or don’t wane at all because they don’t offer anything original in a saturated area. Our company has succeeded because we continue to innovate in an area that is not easy to do innovation.
When you need to enter at least one saturated field try to offer something very exclusive.
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2. It takes too long to achieve a minimally viable product (MVP) in a technology startup.
The technology It’s a difficult field. The tech bubble is showing signs of bursting and the arena is dominated by a handful of conglomerates: Facebook, Alphabet, Apple, etc.
Facebook It didn’t take long to start a competitor Clubhouse, the busy voice-based social network. OR Twitterfor that matter.
It happens over and over again in the field technology:: Instagram copied the stories from Snapchatwhich in turn were copied from LinkedIn. Spotify Y. Tick tock they managed to fend off attempts to copy its functions. But the jury is still not there Clubhouse.
By the time Facebook and Twitter started copying Clubhouse, the new social network already had 10 million users thanks to some of the first big-name users. But the ability to do so Clubhouse To stay in the game now, it depends on how quickly you can innovate and add core functionality to your product to maintain and grow your user base.
If your tech startup idea is taking too long to bring out an MVP or implement improvements, consider joining the development team to shape the business idea.
Image via Depositphotos.com
3. You are bored with the idea
You may have a brilliant idea on paper, but when it comes to you personally, the idea doesn’t appeal to you at all.
This is the redest of the red flags.
If something taught us Steve Jobsis that a company’s success largely depends on the person who runs it.
However, it’s important to note that negative feedback can have a detrimental effect on an otherwise good business idea.
If you are unsure about a business idea, keep it to yourself until you have made a solid decision about whether or not to get it started. Otherwise, negative comments from other people could poison the idea before continuing.
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4. Avant-garde ideas
The latest ideas are difficult to implement when you have plenty of immediate resources. By “innovative ideas” I mean Business ideas based on the latest news. Hoverboards are a great example. Face shields for Covid-19 are another.
s see an opening in the market for these ideas and then throw themselves off. This is hard to do well unless you have plenty of immediate capital to invest or celebrities available to promote it.
Latest ideas are great for making money fast – invest big, get a return on investment, and then jump in. But they are usually not a smart choice for long-term business ventures.
Minimum requirements for a good business idea
People’s business ideas are as diverse as their personal creativity. However, successful business ideas should always have:
- Satisfy a market need or solve a problem.
- Be (relatively) easy to fund.
- Be competitive.
- Be relatively quick to execute (compared to competitors, if any).
- Be something the entrepreneur is passionate about.
A business idea doesn’t have to be perfect for your company to be successful. But it mostly has to be solid.
It depends on the ingenuity, problem-solving ability, and commitment of the entrepreneur to get an idea off the ground.
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