December 1, 2023
I'm sharing business ideas today! These ideas are worth millions! Billions!
The fact that I'm sharing them now and have before should tell you something - business ideas, in and of themselves, are worthless. Don't believe me? Ask Paul Graham. Executing on the idea, turning it into an actual business, is lots of blood, sweat, and tears.
Well here's a set of mine you're welcome to - you'll also find a scoring rubric that I use embedded in each. I evaluate business based on TAM (market size), feasibility of MVP, Moat (difficulty, barriers to entry, competition), and whether the idea is part of a current trend.
HelpGen: Auto-generate help content and how-tos for SaaS products. This one is much more doable now with LLMs, which lowers the barriers to entry. Competitors have made progress on this, but I bet it's still a good opportunity, because no one keeps their help/how-to content on their apps up to date.
Follow My Diet: Have Wegovy/Ozempic/etc killed the diet industry entirely? If not, maybe there's an opening for an app here.
BestUse: Analyzing every jurisdiction's zoning rules, and every parcel's possibilities, could not have been automated until now. The race is on to build this I think.
Run My House: Where's the app that makes it trivial to have everything around my house taken care of? There have been a litany of failures in this space, so tread lightly, but if someone gave me an easy app to run my house, I'd use it.
GuideMe: The automated guidance counselor. The key here is to make this free to students, and to use LLMs to power high-quality advice, not just about going to college, but about all of the career options out there. Get paid by the employers/colleges / career programs to whom you route students?
While I think the ideas are strong (and most/all will get built) - the value there is more in the rubric I use for evaluating the ideas. I use a simple 10-point scale, and here's how it goes:
Can YOU or your team build this MVP and feasibly enter the market? If no, you're DOA and need to pick an idea that you can actually deliver against. Thankfully low-code tools make MVP execution a lot easier! But they aren't a total panacea - and with no MVP the rest is irrelevant.
To get this right, you've got to guesstimate a price point or revenue per customer. If every possible customer in the US (or your home market) signs up for your product, what ARR does that generate? If the answer is less than $100M, that's a 0, or maybe a 1. If the answer is 100M-1B, that's a 2. If it's 1B-9B, that's a 3. And if it's 10B+, that's a 4.The goal here is that 1% of your TAM should enable you to build a thriving business. In my own experience with HiddenLevers, we were playing against a small TAM, but we did capture a couple percent of it, and that proved to be enough for an $8M ARR, strong profitability, and a great exit.
The more difficult, the better! The difficulty in standing up software businesses continues to drop, which actually makes success more difficult as competitors multiply. Unfortunately, this increases the lottery effect in startup land. As a founder you hope to have a business and a product that are hard to replicate - so ask yourself, is there some aspect of your product that would be difficult for the founder next door to replicate?
Is the market segment growing? Does it have the attention of the target industry or target consumer segment? It always helps to have the wind at your back. This helps even more in two specific areas, since investors exhibit the "madness of crowds": fundraising and M+A.
If your idea fails the MVP Feasibility or Market Size tests it's likely toast regardless of its strength in other areas. But it's worth noting that lots of ideas that only score 6 or 7 total on this rubric have been big winners for practical founders - HiddenLevers itself only scored a 6! As always, execution beats idea perfection every time...
