How to pick a winning business idea
These are the 4 ingredients of a successful business:
a. Founder - The founder has to be smart, driven, and passionate.
b. Market - The market must be growing. It must also exist.
c. Product - The product has to work well for its intended purpose.
d. Marketing - The marketing has to reach target customers effectively.
I know, that's hardly insightful.
But what's insightful and often overlooked is the interaction between these factors, namely:
- Founder-Market Fit
- Founder-Marketing Fit
- Founder-Product Fit
- Product-Market Fit
- Product-Marketing Fit
- Market-Marketing Fit
1. Founder-Market Fit
You must have domain expertise and experience with this market.
Don't do something where you're way out of your depth; don't stray too far from what you already have deep knowledge about.
Why make your business unnecessarily riskier when it's already so risky?
2. Founder-Marketing Fit
ICYMI you're supposed to figure out marketing/distribution before you even start your business.
Make sure whatever repeatable marketing strategy you choose fits your personality.
Don't do YouTube/TikTok if you can't speak well, don't do cold calling if you have social anxiety, and don't do LinkedIn if you can't convincingly play a bootlicking corporate drone.
3. Founder-Product Fit
Even with founder-market fit, you still have to be able to make the product.
If your present skillset doesn't match the skillset needed to successfully build and iterate the product (e.g. coding, animation, writing, AI prompt engineering), you don't have a business.
4. Product-Market Fit
Ah, this is the Holy Grail of any successful business.
It's when your product as-is fully satisfies the demands of the market, and people are tripping over one another to pay you money.
In general, you get here by progressive iteration based on relevant customer feedback.
There's no other way, unless you're a product visionary like Steve Jobs (which you're not).
5. Product-Marketing Fit
Whatever your product is, it has to be marketed the right way.
TikTok can work for consumer products, but maybe not for B2B products.
Paid ads can work for dropshipped goods, maybe less so for digital downloadables.
6. Market-Marketing Fit
Some markets loathe to be marketed to in a certain way.
A direct sales force might work for certain B2B niches, but less so for consumer markets.
Do your own research and don't antagonize your target market by the means you reach out to them.
Play your cards right to up your odds of success
The 6 Fits framework above is truly simple to follow.
Make sure all of the boxes are ticked first before you embark on a venture.
Better pass on ideas that are unsound, right now, than to try to force your way through a bad business idea.
It won't suddenly work just because you're driven and persistent -- because the idea is fundamentally flawed!
It's like trying to get to your destination using your expert navigational skills... but the wrong map.
You'll never get to your destination.
Willpower is a non-renewable resource
I firmly believe we have in ourselves maybe 3-4 really good attempts at entrepreneurship.
If we don't succeed during those attempts, we instinctively stop trying (as a defense mechanism) and give up for good.
Do you really want to be one of those who have given up permanently and resigned to their fate of corporate drudgery until they're old?
Make your attempts count, start your business the smarter way.
I'm rooting for you. 💪
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"don't do LinkedIn if you can't convincingly play a bootlicking corporate drone."
I beg to differ. I am a solo bootstrapping entrepreneur posting about my startup and build-in-public stories on LinkedIn and I getting good engagements with 6k+ followers.
That's great.
But that line was there for comical effect, not to be taken literally!
I particularly appreciate the 'Founder-Marketing Fit' aspect. The significance of marketing and distribution, especially aligning marketing strategies and tactics with oneself, is often overlooked by startup newbies. For startup owners, entrepreneurs, and indie hackers, understanding marketing and distribution even before launching your business can play a crucial role in the success of a startup.
Like we always say:
"First-time founders focus on product. Second-time founders focus on distribution."
I learned the hard way when I picked an idea where I didn't have Founder-Marketing Fit (I pursued an enterprise B2B idea as an indie hacker, what a dolt I was).
Only good thing that came out of it was that I failed fast, and it seared into my mind the utmost importance of Founder-Marketing Fit.
Your explanation is really helpful. I appreciate you sharing this.
I've had social anxiety for all my life and cold calling has helped me being WAY more confident in social situations and in general, it is a skill that can be trained and you can habituate to it. It hurts to see you discourage people with anxiety to do such stuff that could help them in business and in their daily life. Maybe you should understand how important anxiety is.
Thank you for these helpful insights! Will start keeping these tips in mind when thinking about pursuing an idea!
Or reverse it and find ideas people are actually searching for...
How?
How do you find low-competition keywords?
How do you know competition won't pick up as you're building the product?
Great post indeed. Among the 6 aspects, I would place Founder-Market fit above the others. As no startups take off from day 1, keep iterating during the death valley is a must and without Founder-Market fit, without the right passion into the market, it is enormously difficult for one to keep iterating at cold stage
Yup, I think so too.
Founder-Market fit will lead to Product-Market Fit eventually.
Great post!
Appreciate you dropping by.
I am a Solopreneur - just starting my business journey. Appreciate your guidelines and hope to implement them to start a thriving business.
Hope you find them useful!
Don't listen to people who say ideas are worthless.
On the contrary, ideas are everything.
Ideas determine markets, and markets are everything.
Very insightful. Thanks for sharing.
You're welcome.
really appreciate the way you described founder market fit and founder marketing fit
That's food for thought! Great post, thank you!
Someone told me about Founder-mission-fit. What do you think about this?
It depends what they mean by that.
"Mission" is something that's a bit vague.
You should probably give credit to Brian Balfour https://brianbalfour.com/four-fits-growth-framework
I've never heard of Brian Balfour.
It's just something that came to my mind, because people keep talking about Product-Market Fit and Founder-Market Fit.
So naturally there must be other forms of fit too.
Very interesting takes here, all of which i completely agree with. Im currently building a tool that helps students and researchers understand papers better. For my product my co-founder and me are currently trying out collaboration with study associations, SEO and TikTok to see which one works out best. Do you have any tips for us or unique insights?
Select a winning business idea by identifying market needs, assessing competition, considering your passion and expertise, validating demand, and ensuring scalability and profitability for long-term success.
To choose a prevailing enterprise idea, center of attention on fixing a actual trouble or pleasurable a want in a special way. Start by means of figuring out your strengths, passions, and areas of expertise. Then, lookup market trends, client ache points, and competitor choices to discover opportunities. Validate your notion via surveys, interviews, or prototype trying out to make certain there may be demand. Consider factors like scalability, profitability, and long-term viability earlier than finalizing your choice. Iterate and refine your idea based totally on comments and market insights. Ultimately, pick out a commercial enterprise notion that aligns with your goals, resonates with your goal audience, and has the conceivable for sustainable growth.
Thanks for sharing insights on selecting a winning business idea! Your tips pave the path for entrepreneurial success ahead.
What I see seasoned indiehackers do. Is create a rough mvp that usually consists of a landing page with an email submission or a pre-order form. If there is demand it gets built. If there isn't than pre-orders refunded and idea abandoned.
I don't think that's a foolproof method for validation.
You can get a lot of false positives or even false negatives that way.
I haven't personally done this. I've just seen a lot of buildinpublic folks on X do this. Others just create a really rough mvp with the main feature that separates them from the rest.
I guess doing that is better than doing no validation at all.
I made a competitor social media analysis tool. app.socialtrendanalysis.com is a tool that enable you to analyze thousands of your competitor content marketing strategy all in a single screen.
Would love your feed on the tool