There are many, many popular myths about money from a venture point of view, which have been overblown. While to some extent they are true, in an entrepreneurship context, they have become fairly irrelevant over the past decade or so.
In the license and industrial era everything was about financial capital – capital to put up plants, to pay license fees etc. etc.
In a regulated environment with little flexibility the capital required was quite high and thus only existing business families or their heirs were able to invest and flourish. As the markets opened up, new opportunities came by and the government had but no option to lessen its role and minimize regulations.
All this while, business itself was witnessing a seismic shift from manufacturing to services. And today services sector outperforms the manufacturing sector in many leading economies across the world. This twin paradigm shifts led to “intellectual capital” as being the primary business driver unlike financial capital before. Thus bringing “IDEAS” to the center stage of the business and being the core of entrepreneurship. In this article I focus on the redefinition of “IDEA” and how that implies “Opportunity” with a capital O for every budding and aspiring entrepreneur amongst you.
The existing idea of IDEA is about something totally new, radically new or something unheard of or unthought of before. And most people were led to believe that for a new venture one needs to have an idea that fits into this definition. Since that is a practically daunting proposition, I have seen many resign themselves to being mere observers saying I do not have that great or winning idea. Liberation is at hand, for an “IDEA” that works in the business context and one that will make you a successful entrepreneur need not be new, need not be radical and best of all can even be one that is existing.
Let me elaborate with examples. A successful business idea can be:
- A more efficient way of doing an existing thing. For example if you can figure how to pack and move goods in a more cost efficient manner than the existing players that is the IDEA enough to start a new venture. Dell is a good example of this approach. The company neither invented the PCs nor does manufacturing of any of the components that goes into it. All it did was figured a new model, which was far more efficient than the current model of selling PCs. Today Dell is a Fortune 500 company and has transformed the PC market landscape forever.
- Addition of new feature or facet to an existing venture – let us you are a hair salon. You add massaging, therapy, manicure and pedicure solutions to your salon and call it a complete grooming and wellness boutique that is a new segment.
- Picking gaps in an existing model – Now as the economy evolves there are going to be a group of customers whose levels of expectations or whose importance of a particular sub-service within a overall service bouquet will be different or higher. And these customers will be willing to pay a premium for a focused venture that provides them that sub-service in the manner, format and service level they desire. To cite an example, recruitment is a whole service with many sub-services. Let us say you pick out testing of candidates and come up with a solution only for that, it would have customers willing to buy that solution. Or to cite another example, if you create a specialized venture targeting only premium inbound tourists from abroad, that is a viable business proposition.
- Adopting a new strategy for an existing product or service out of market or consumer insight – for example, Graphic User Interface (GUI) which led to the phenomenal success of Windows operating system (and by default of Microsoft) was not their original idea nor were they the people who developed it first. But they were the first to see its importance from a consumer point of view.
- Package it better – in this you weave all the elements of that service in a different packaging and then standardize it and go to the consumer positioning it as a differentiator.
And one can thus go on and on. And if you noticed it, the scope is tremendous and there is no need to have any big formal qualifications or huge experience to do some of the things mentioned here.
Entrepreneurship is not just about radically new ideas but is also about million new improvisations and additions that increase the customer satisfaction or provide a new benefit. It is true democracy out there. Finally, unconstrained by the need to have significant financial capital to start. If you can figure it well, package it better, have a model to it repeatedly well and have enough customers to affirm that value proposition, you are well on your way to venture capital funding and entrepreneurship glory. Fancy your chances. It is a whole new world out there. So what, if you only have a penny or less in your pocket?