Building a startup like every other path requires putting in effort and being dedicated and most importantly, staying focused. For a startup to last long and survive the storms, it needs to be based on a good idea. What makes an idea worth it? What are some things you should take note of while building your startup?
In the last blog of this series, we wanted to respond to this and other questions. You might have related to building a startup. This blog is based off a Microsoft Learn path, Build an early-stage startup. This Microsoft Learn path contains some of the best tips you can ever get to help you build a successful startup. These tips have helped me when working on projects and so I decided to share. I’m sure it would benefit you too.
You can also check out other learning resources found in the learning collection in the link below.
Let’s begin this blog by talking about some things you need to think about when coming up with a startup idea.
What questions do you need to ask when coming up with an idea?
Let's not consider 4 relevant questions that can help you restructure your idea and work on a more impactful solution.
- What ideas should I be working on? Many startup founders today decide to work on ideas that are self-evidently good, ideas that many other people are likely to work on or that already exists. Such ideas are competitive and less likely to succeed. So what should you be thinking about? Think of things that are not common, that are rare. Some of the best startup ideas sound wild at first but are actually good. This reduces the competition as many people are not thinking of the idea or scared of working on it.
Keep in mind that it is totally fine to have competitors but having lots of competitors makes it difficult for people to notice you. It’s even more difficult when your competitors are further along in their product development and have significant capital to maintain their market lead.
So, what ideas should you be working on? Some of the best startup ideas are counterintuitive to most people. These ideas are only visible to people with deep insights into the problem space. These insights are most times not visible to others.
For example, Airbnb had a wild idea. They were looking to raise money to make up their rent in San Franciso. They decided to rent out air mattresses in their apartment to attendees of a conference because all the hotels were booked. The called their service “Air Bed and Breakfast”. Around 16years later, they are worth billions of dollars.
That wild idea, that unachievable idea, that idea that people thought wasn’t viable is now a widly successful tech company. The unique insights of the founders gave them the ability to see past this objection and pursue a business model that most people thought wouldn’t scale.
- Who are my competitors? It is important for you to have a clear understanding of your competitors. Examine your market and identify your competitors. Spend some time doing this and see how many competitors you can find. Remember not to only look for direct competitors but also indirect competitors that might provide an alternative solution to the same problem. Create a list of all the competitors.
Next, ask yourself, does my startup stand out as doing something new and innovative? Does it appear to be one of a large number of undifferentiated competitors? If your answer to the second question is affirmative, then you might probably want to reconsider your idea.
- Is my idea scalable? Successful startups tend to be highly scalable, meaning they can grow rapidly. Scalable startups can become increasingly efficient in terms of resource requirements as they deliver their product to an expanding customer base. If your business model relies on having to perform repetitive, non-scalable tasks, you might face major barriers to scalability and growth.
For example, if your idea entails you hiring people to do in-person sales calls, you will realize that the more customers you have, the more money you would spend. You could think of automating some of those conversations and processes using tools like Power Automate and Power Virtual Agents. These tools have proved effective especially with regards to customer support. A scalable idea or business model is one that costs you little effort, resources and funds to manage thereby enabling your company to grow rapidly.
- Is this the right time to work on this idea? There is an optimal time for every startup idea. Make sure you’re not launching your startup too far ahead of the opportunity, or too far behind.
An example of launching too far ahead of the opportunity would be a marketplace for sharing of quantum computing capability. Quantum computing is going to be a huge opportunity at some point. But it might not be wise to set up a marketplace for sharing that capability today; you’d be some years ahead of the curve. On the other hand, it won’t be great to start an online bookstore company today as the optimal time for that business has passed. So, ask yourself again, is now a good time for this idea? If yes, why?
Sometimes shifts in technology, consumer behavior or regulations make it easy to kickstart your startup. For example, the founders of Uber identified a growing acceptance of the sharing economy by consumers, as well as the emergence of ubiquitous GPS and high-quality maps on smartphones. As a result of this, they launched the company in 2009.
Had someone tried to launch a ridesharing app like Uber five years earlier, it wouldn’t have made sense. Similarly, if someone were to start another rideshare company today, it would face stiff competition from existing ridesharing apps that have already established traction, market share and a strong brand.
Consider the 4 questions right from the beginning so you're sure you're working on the right idea and investing your time into something worthwhile.
1. Curious about leveraging technology to unleash your startup's capabilities? #MicrosoftforStartups Office Hours is a virtual event, where you get to learn more about the opportunities presented by #FoundersHub to gain a technical edge!:timer_clock: March 14, 2023 | 14:00 (GMT +1). Reserve your slot: https://aka.ms/MSFT4StartupsEvent
2. Do you have to write code to be successful in tech?
3. If you're a student and have some cool ideas, be sure to participate in Microsoft Imagine Cup competition. Check it out here: https://aka.ms/ImagineCupSignUp