How to come up with a business idea
Want to start a business? Aren't sure how to make it happen? Read our launchpad guide for tips on how to create a winning business concept...
The UK is rapidly becoming an “army of entrepreneurs”. Some 581,000 start-ups launched in the UK last year, more than 4.6 million people are self-employed, and the number of people taking entrepreneurship courses has risen by 200% since 2014.
It’s clear that now, more than ever, the title of ‘entrepreneur’ has cache. But how do you make the dream happen and create a winning business idea?
Action point: Could a loan help you to start a business? See how we may be able to help here and here
To help you have that ‘lightbulb moment’, we’ve created a launchpad guide which will assist you in coming up with a business idea and ultimately give you that all-important push to become a start-up entrepreneur. Read on for ways to find your start-up brainwave…
Focus on your interests
Think about your hobbies and passions and how you could mould this into a business idea.
How great would it be to turn something you love doing into a successful venture? For instance, if you’re passionate about keeping fit then you could look at starting a fitness franchise or become a personal trainer. Or, if you’re a keen animal lover, you could start a dog-walking or pet sitting business. Love baking? Start a cake-making business or open up a cafe. The possibilities are vast and we’ve got a range of start-up guides here which can help.
You could also expand on your interests to start a part-time business such as writing a blog, producing a vlog (video blog), or making money out of Instagram pics and selfies. If you’re a university student, there are number of business ideas you can start while at university such as e-commerce, a social network, or app business.
Build on your knowledge and skill-set
This might seem pretty obvious but you’re more likely to succeed in business at something you’re good at. Say you currently work as a web developer or in IT, you could use these skill to start a coding club, consultancy business or could even become a growth hacker.
Numerous entrepreneurs have found success by building on their skills from a previous job. Take Purplebricks, its founders Michael and Kenny Bruce launched their 24/7 online estate agency in 2014 following years spent working in the property industry. The business recently raised £58m in its AIM listing and is turning the industry on its head by effectively cutting out the middleman.
Look at business and consumer trends – ask yourself what’s next?
Market research is essential to know if a business idea has legs. By browsing recent analysis of business and consumer trends and expert opinions, you may find a potential business opportunity is staring you in the face.
Check out our index of 16 top business ideas for 2016 for inspiration or, if you’re a keen techie, take a look at our predictions for the technology trends that are going to be big this year.
Research the current market and look for ways you could take a market share
Size up prospective markets to see if there is a way that you could take a slice of the action. For instance, if a certain business is succeeding in London, think about ways you could create a similar business but on a regional, or even, national level. A good example of this would be the success of craft beer clubs and services; while Edinburgh-based Beer52 has quickly gained traction, London-based competitors such as HonestBrew are also scaling rapidly.
You can better understand the market and growth of particular industries by taking a look at our Startups 100 index of the UK’s best and brightest start-up industries and our inspirational Startups Awards winners.
Similarly, look at overseas markets and think about how you could bring a popular product or service to the UK. For instance, fermented yoghurt-drink Kefir has always been a popular drink in Russia but has just started making waves in the UK thanks to start-ups such as Bio-tiful Dairy.
Reflect on potential solutions that could make your life or the lives of others better
Think about creating a product or service that could actually make a difference; be it big or small. Don’t just think about solutions that would have an impact on you personally but look at it from the perspective of a mother, father, son, daughter, student and so on.
3rings is a good example here; it has contructed an Internet of Things app which helps families care for elderly relatives remotely. Other good examples are the likes of Gousto and Hello Fresh which created an alternative way for time-poor professionals and families to cook healthy meals. Similarly, you’ve got citation referencing tool RefMe which looks to help university students, or Kano – the DIY computer kit start-up – which is targeted at helping children learn to code from an early age.
Alternatively you could start a business where social or ethical goals are part of the mission; much like Innocent Drinks which gives away 10% of its profits to charity. View our guides on starting a social enterprise here and find out more about starting an ethical business here.
Travel the world and try new things
Some of Britain’s best businesses were inspired by trips overseas. Founders used their unique travelling experience as a springboard to launch a successful venture. For example, the idea behind luxury handmade chocolate brand Montezuma’s was ignited by a trip to South America while fast-growing popcorn company Joe & Seph’s was inspired by the founder’s time in America.
Take a look at our Inspired by Travel feature for more great ideas and how some of Britain’s best-loved brands emerged from foreign shores.
Network, network, network
What better way to get your entrepreneurial juices flowing than hanging out with, networking among, and speaking to, successful start-ups and those that are looking to start-up.
For the best places to meet budding and established entrepreneurs, view our guide to the UK’s best clubs, hubs and workspaces. You can also discuss and share your business ideas, experiences and insights in the Startups forum which has a community of over 40,000 people.
Look at why you’re thinking of starting a business
Is it to escape work and become your own boss? To make money? Help others? Or are you making something a little better, cheaper, faster?
In most cases, you won’t be able to make money straight away so you’ll need to be lean and have a bit of cash behind you as you get the business off the ground. Having a ‘mission’ will give you purpose. Purpose will give you passion. And the combination of passion and purpose in many cases leads to profits.
We’ve listed the various reasons to start a business here and you can take a look at our guide on being an entrepreneur to determine whether you have what it takes to develop and create a successful business.
Consider how you’ll overcome the challenges
Almost half of all UK small business owners admit to having had to sacrifice family time, holidays and income to start a business while an eighth say they only have three to four hours sleep a night.
While starting and running a business can bring you great happiness, independence and profits, you’re unlikely to become the next Sir Richard Branson overnight so you need to think carefully about how you’re going to deal with the obstacles and challenges that starting a business can bring.
Find out more about the toughest challenges you’ll face when starting up here.
Think about what you’ll need in order to start
You might want to start your business from home – read our home-based business guides – or you might want to start your business as a sideline project while you work; advice on starting a part-time business is available here.
Most start-up businesses will need some money to get started. This could be in the form of a bank loan, equity investment, asset finance, Start Up Loan, angel investment, crowdfunding and much more. Check out our guide to raising finance here.
Alternatively, you could look to secure a government grant. View our guide to small business grants and where to find them here.
Ready? Set! Go!
Once you’ve got your business idea and think it’s viable, you’ll need to look at actually setting up your business such as constructing your business plan, choosing a business name, creating a website and so on.