One of the fastest ways to increase your speed to financial success is to discover an idea that breakthrough in the business world. Ideas breakthrough when they create the desired impact and make the business owner successful. Thus one of the most fascinating things to watch is an idea that evolves from an ordinary idea to a million-dollar idea in the hands of a seemingly ordinary entrepreneur.
This is because this process gives the entrepreneur a rare chance of creating their own wealth. Yet coming up with ideas is the easy part. Millions of great ideas are discovered every day. The difficult part is making an idea successful. Research shows that over 75% of business ideas fail within the first ten years. These ideas were once thought of as brilliant ideas. And the business owner once had high hopes for this idea.
Thus what business owners think about an idea is less important than what the market thinks and feels about the idea. Although ideas rule the world, it is evident that certain ideas are beaten by the world to death. So what do you do to maximize the success of an idea? How do you make an idea successful? And how do you turn ordinary ideas into million-dollar ideas?
The answer is twofold.
To maximize the success of an idea you need to approach it from two angles.
The first angle is to know the important things about ideas. That is what an Idea is and what it is not. And the second thing is to know how to make an idea breakthrough in the business world. Below I explain each of these angles in detail
The Nine Important Things about Ideas that you should Know
1. Ordinary Ideas cannot make you Rich
One of the most common myths in the world is to think that coming up with brilliant ideas is the key to success. While great ideas do play a role. Ideas in their ordinary form cannot make you rich. This is because ordinary ideas are thoughts and insights in the head of the business owner. And these thoughts and insights are unproven and oftentimes far removed from reality. I know this because millions of great ideas are discovered every day. And one would expect that there would be millions of successful businesses in the world. But as it stands there is only a handful of them. The mere fact that there are only a handful of successful businesses proofs that coming up with brilliant ideas is not the final answer to wealth.
To create wealth you need to test and validate your ideas with real customers. Testing and validating your ideas is the only way to know want customers are willing to pay for. When customers invest in an idea it is proof that some of the assumptions made by the business owner are valid. Your goal is to get your idea into the wild market as quickly as possible. Test it to see what is working. And streamline your solution to only reflect what is working.
2. One Idea Cannot Make a Business Successful
One of the secrets to business success is the ability of the business owner to innovate ideas and combine them intelligently. A successful business is thus a combination of complementary ideas. To think that just one idea is the game changer is naïve. Although great businesses are based on one overarching idea. They are built on a combination of several ideas. Thus to a breakthrough in business, you must innovate continuously. And combine ideas in ways that maximize your business wealth.
3. All Ideas can either Succeed or Fail
There is no idea that is a strict success. All ideas have the capacity to either succeed or fail. And what determines the success or failure of an idea is threefold. The first is the idea executor. The second is the execution strategy. And the third is the alignment of the idea with the target customers. Businesses that have the right idea executor, the right strategy and the right solution will generally succeed.
4. The Business Owner is the greatest determinant for Idea success
The business owner carries the most power that can make or break an idea. The same idea in the hands of different business owners will produce different results. Just like a ball in the hands of Lionel Messi or Cristiano Ronaldo and the same Ball in the hands of a Novice will produce different results. The difference in results is not based on the idea. But based on the difference in the capacity of execution of the business owners. There are three factors responsible for the difference in capacity. The first is the speed of personal growth of the business owner. The second is the rate of testing, validation, and learning. And the third is how well a business owner knows and listens to the customer.
A great idea in the hands of a competent business owner will succeed. And the same idea in the hands of a deficient business owner will fail. Even when great business owners find themselves in a bad idea situations. They are able to innovate their way out of it.
5. There are no Successful Ideas
Successful businesses are made by a person and not an idea. When an idea succeeds in the business world. It means that a business owner has been able to lift their ordinary ideas to the level of a million-dollar idea. Without the influences of a business owner, ideas remain in their unprofitable state. To lift an idea from its ordinary state to the million-dollar level is a messy process. What determines the length and depth of the mess and how long it takes to hit the million-dollar mark is how well the business owner understands the customers.
6. Ideas succeed at the right time and within the right Environment
Not all ideas can thrive in the same place, at the same time, and given the same conditions. Some ideas are geographical in relevance and are better suited for a certain location. Other ideas are global in relevance and can thrive in any environment. Even so, the environment in which an idea finds itself plays an important role in deciding the success of an idea. This why a business based in Lagos will deliver a different success results than the same business based in Port-Harcourt or Kaduna. Understanding how the environment affects your business idea is critical for business success.
Similarly, timing plays an important role in the success of an idea. Certain ideas are far ahead of their time and others are late in time. When you come up with ideas that are late or far ahead of their time you prolong your years of struggle in business. The key to business success is to come up with ideas that are relevant today or combine those ideas with those that will be relevant in the future.
7. Best Ideas are not the answer best solutions Are
A success of a business depends on the kind of problem it solves and how important this problem is to the customers. To solve problems you need solutions. Thus finding the right solution is the key to business success. When you shift your focus from finding the best ideas to finding the best solutions. You increase your odds of success in business. To create the best solutions you need to know three things. The first is how the customers are currently solving the problem you seek to solve. The second is the gap in the existing solutions. And the third is how your solution will close this gap and deliver superior value to customers. These are the three ways to create solutions that exceed customer’s expectation.
8. You do not need to be the first
A lot of business success is execution and not the idea. Thus spending your whole life looking for novel ideas that can be stolen, lost or destroyed is the fastest way to waste your time. The business world does not care about novel ideas. It cares about brilliant execution. The best ideas are useless unless executed properly. And being the first to come up with an idea does not guarantee success. Pioneers of ideas work ten times as hard. They do all the heavy lifting for those coming behind. And their chances of failure is pretty high. Without rock-solid resilience to go through uncharted paths and laborious work. You will not make it. So do not be put off by ideas that already exist. The mere fact that people are working on the idea proofs it is a profitable idea. Plus it is easier and faster to create wealth in a proven market.
9. Your No 1 Business Idea is Marketing
When I ask a lot of business owners what business they are in. I usually get a reply that signifies the business industry, Business name, or sector. While this is an appropriate answer for simplicity and differentiation. You must never forget the No 1 business you are in. Your No 1 business is marketing. That is your ability to continuously attract your ideal customers. Convert them to paying customers. And make them buy from you over and over again all at the lowest possible price. If you fail in your No 1 Job your business idea is dead on arrival. Without marketing, you cannot make money in business. And without money, there is no business.
So now that you know the nine important things there is to know about ideas. How then can you make ordinary ideas breakthrough in business?
To convert ordinary ideas to breakthrough ideas there are four things you must do. The first is to find a great problem to solve. The second is to discover a Great Solution. The third is to become a million-dollar idea Executor. And the fourth is to get your first set of customers. Below I explain these four components in detail
- Find a Great Problem to Solve
The singular purpose of an Idea is to solve a great problem for many people. But what is a great problem?
A great problem is any problem with lasting relevance that affects a lot of people. And there are five key areas to look at if you want to find great problems.
The first area is the areas of Movement. Human beings by nature want to move from one place to another. They want to expand business opportunities, acquire new territories, and have new experiences. Any idea that Increases the speed, style, and convenience of movement of humans and cargos has the potential to create wealth.
The second area is the area of Transactions. Human beings since history do not have all that they need in one place. Thus they depend on others to get what they need. This unequal distribution in wealth and advantage is the reason why transactions are important. People and Countries exchange cash, goods, and services to meet their needs. This makes transactions central to the way we live as humans. Ideas that simplify, or increases the speed of transactions have the potential for creating wealth.
The third area is the areas of Communication. Human beings have the innate desire to relate with one another. Deep inside our DNA is the desire to communicate, build rapport, and nurture rich relationships. Thus, any idea that eases communication. And makes it more convenient and intimate, has the potential for creating wealth.
The Fourth area is the area of Finance. Money answers all things and it is how we run our personal and global economy. Money gives you the ability to survive. Live a dignified life and have a good standing in society. Without money, you cannot eat, drink, pay bills, and have a roof over your head. Making money is thus fundamental to how we live, work, and grow. Ideas that help people make money, survive better and live a more dignified life have the potential for creating wealth.
The Fifth area is the area of Personal Development. Every human being wants to become a better version of themselves. Deep in every human being is the desire to understand themselves. Their source. The world. Other human beings, diseases, plants, and animals. This makes human development fundamental to human nature. Ideas that help people discover themselves. Understand their purpose and live with other people effectively has great potential for creating wealth.
These are the five great problem areas you should focus on. These five problem areas are not automatic wealth ticket. To succeed in them you need to innovate in five areas. The first is the Product Design. You need to come up with a better look and feel, and products that enhances customer status. The second is Predictability. You need to create more predictability in the customer’s transformation process. Customers want predictable results. The third is Speed. Customers want to achieve more in less time. You need ideas that is a big time saver. The Fourth is Convenience. Customers want to reduce stress and have a blissful product experience. You need to make your solution seamless for the customer. And the fifth is Cost. Customers want value for their money. You need to increase the perceived value of your products. These are the five key areas to innovate on if you want to create wealth solving the five great problems.
- Discover a Great Solution
A great solution is any solution that eliminates customer’s pain, helps customers achieve their desired goal. And solves the problem for the customer in ways that they want or wish. Creating a great solution is not an easy process. It is not easy because it takes a lot of testing to get to the right answer.
There is a wide gap between the world view of the typical business owner and the target customers. Business owners come from the Ideal world. They develop solutions based on the Ideal with little consideration for how the customer wants the problem solved. Creating solutions from the ideal world can be tricky and full of assumptions. To create solutions that match customers’ needs. Business owners must shift from their ideal world to the customer’s world.
Customers live in the real world. And in the real world, Ideal rarely exist. Customers are entangled with problems, obstacles, and challenges. And they can barely see a way out. Thus they are looking for simple solutions with a clear less disruptive path they can take to get to their desired goal. This means that the first time an idea is introduced into the market is not likely to be the breakthrough time. There is likely to be disconnect between what customers want and what business owners think customers want. It is at this point, that business owners need to make a decision. They either choose to follow customers lead and evolve the idea to what customers want or choice to remain with the original idea and fail.
It is the ability of the business owners to listen to customers. And quickly transform the original idea to forms that are more aligned with the customer that create wealth in business. Idea changes and iterations are inevitable in business. And these changes do not signify business failure. Rather there signify that an idea is evolving to the form that is more acceptable by customers.
Typical examples of ideas that have evolved from their original form include the following. Coca Cola evolved from a Pharmaceutical store to a beverage company. Tiffany jewelry evolved from a stationary store to a luxury jewelry store. Nokia evolved from a paper Mill Company to a Phone company. And Avon cosmetics evolved from a book sales company to a beauty company. All of these companies understood one thing. They understood that the only idea that makes it in business is the idea that is perfect in the eyes of the customer. Having ideas that are perfect in your own eyes is the slowest way to create wealth. To create wealth with speed you must discover ideas that match what customers agree is perfect for them.
- Become a Million Dollar Idea Executor
What makes businesses succeed is the ability of a business owner to execute a business idea brilliantly. A Million dollar idea Executor is thus anyone that has mastered the art of combining massive action with massive reflection. And a cheaper way of learning. This means that this person must act fast, fail cheaply, and never waste any learning experience.
The truth is that, you may not yet be this person. And becoming this person requires a process without which you cannot lift your business idea off the ground. Poor execution is the fastest killer of great business ideas and thus becoming a million-dollar idea executor is critical for your business success.
So what do you do to become a million-dollar idea executor?
To become a million-dollar idea executor you need to do three things
First, you must understand who a million-dollar idea executor is for your business. That is you must create the profile. Second, you must determine what you need to do to become this person. And third, you must do everything within your power to become this person and move your business to the next level.
Becoming a million-dollar idea executor is not about acquiring expensive formal education. These types of education are based on theory and theory rarely works in the business world. To evolve into a million-dollar executor you must be refined in the trenches of the real business world. In the real business world, there is massive testing and action. Continuous action creates competence. Competence creates understanding. And Understanding creates capacity and confidence. It is the ability of a business owner to combine competence with understanding and reflection. That creates the wisdom and resilience needed to lift a business up to wealth.
- Get Your First Set of Customers
The purpose of a business is to make money in exchange for value provided. And the only activity that makes the money-making part possible is marketing. Marketing is simply letting people know that you can solve their problems. And convincing them that they should pay you the stated amount for the problem that you solve. Without successful marketing, no business can succeed long-term. To succeed with marketing you must ensure that the cost of acquiring customers is lower than the Lifetime Value of the Customer. That is there must be a wide difference between what it cost you to serve the customer and the reward that you get from serving the customer. This is the only way to create profit in business. Profits are critical for long-term business success. If your profit margins are low or non-existent you can hardly deliver excellent customer value to customers. The purpose of profit is to create the allowance a business owner need to exceed customer’s expectation. It is also necessary to fuel and sustain a business long-term. If your business is really solving a great problem, customers do not want your business to disappear. So settling down for low profit is harming your business and customers long-term.
The truth is that you cannot just increase your profit margins. To succeed with higher profit margins you need to justify it with a higher perceived value. Customers are not stupid and should not be treated as such. So rather than ask the question how can I lower my prices? Ask the question how can I increase the perceived value for my products.
Your goal as a smart business owner is to understand what customers want and what they perceive as value. And to inject this value into your products and services. The higher the customers perceived value of your products the more willing they will be to pay for your products. The more customers pay, the more profit you make. The key here is to note that Perceived value is not the same as real value. And sometimes the most valuable products are the least profitable products. Thus increasing value is not the answer. The answer is increasing perceived value in the eyes of the customer.
I know these seem like a lot to cover for a budding entrepreneur or even an experienced one. This is why it is impossible to build a great business all by yourself. You need the right relationships, the right counsel and the right collaborations to lift your business idea to the next level.
If you would love to invest in yourself. Leverage sound business advice and get professional business mentoring that will cut short your years of struggle in business. We can help you. Send an email to [email protected]
Grace Agada is The Senior Financial Happiness Director @ Create Solid Wealth. She is an Author, and Column Contributor in Six National Newspaper. She is a contributor at BellaNaija, Nairametrics and Proshare and she is on a mission to help working-class professionals and CEOs climb the wealth Pyramid and become more financially successful. To learn more about Grace and how she can help you send an email to [email protected]
5C’s of creditworthiness: What lenders, Investors look for in a business plan
Business owners need to be aware of the criteria lenders and investors use when evaluating the creditworthiness of entrepreneurs seeking financing.
Banks usually are not a new venture’s sole source of capital because a bank’s return is limited by the interest rate it negotiates, but its risk could be the entire amount of the loan if the new business fails. Once a business is operational and has an established financial track record, banks become a regular source of financing.
For this reason, the small business owner needs to be aware of the criteria lenders and investors use when evaluating the creditworthiness of entrepreneurs seeking financing.
Will the business that an entrepreneur actually creates look exactly like the company described in the business plan? Of course, not.
The real value in preparing a business plan is not so much in the finished document itself but in the process it goes through – a process in which the entrepreneur learns how to compete successfully in the marketplace. In addition, a solid plan is essential to raising the capital needed to start a business; lenders and investors demand it.
Lenders and investors refer to these criteria as the five C’s of credit.
1. Capital: A small business must have a stable income base before any lender is willing to grant a loan. Otherwise, the lender would not be making, in effect, a capital investment in the business. Most banks refuse to make loans that are capital investment because the potential for return on the investment is limited strictly on the interest on the loan, and the potential loss would probably exceed the reward. In addition, the most common reasons that banks give for rejecting small business loan applications are undercapitalization or too much debt. Banks expect a small company to have an equity base investment by the owner(s) that will help support the venture during times of financial strain, which are common during the start-up and growth phases of a business. Lenders and investors see capital as a risk-sharing strategy with entrepreneurs.
2. Capacity: A synonym for capital is cash flow. Lenders and investors must be convinced of the firm’s ability to meet its regular financial obligation and to repay loans, and that takes cash. More small businesses fail from lack of cash than from lack of profit. It is possible for a company to be showing a profit and still have no cash – that is, to be bankrupt. Lenders expect small businesses to pass the test of liquidity, especially for short term loans. Potential lenders and investors examine closely a small company’s cash flow position to decide whether it has the capacity necessary to survive until it can sustain itself.
3. Collateral: Collateral includes any asset an entrepreneur pledges to a lender as security for repayment of a loan. If the company defaults on a loan, the lender has the right to sell the collateral and use the proceeds to satisfy the loan. Typically, banks make much unsecured loans (those not backed up by collateral) to business start-ups. Bankers view the entrepreneurs’ willingness to pledge collateral (personal or business assets) as an indication of their dedication to making the venture a success. A sound business plan can improve a banker’s attitude towards venture.
4. Character: Before extending a loan or making an investment in a small business, lenders and investors must be satisfied with an entrepreneur’s character. The evaluation of character frequently is based on intangible factors such as honesty, integrity, competence, polish, determination, intelligence, and ability. Although the qualities judged are abstract, this evaluation plays a critical role in the decision to put money into a business or not.
5. Conditions: The conditions surrounding a funding request also affects an entrepreneur’s chances of receiving financing. Lenders and investors consider factors relating to a business’ operation such as potential growth in the market, competition, location, strength, weakness, opportunities and threats. Another important condition influencing the banks is the shape of the overall economy, including interest rate levels, inflation rate, and demand for money. Although these factors are beyond an entrepreneur’s control, they still are an important component in a banker’s decision.
The higher a smaller business scores on the five C’s, the greater its chances of receiving a loan.
Written by Chukwuma Aguwa
Don’t be fooled by COVID-related scams
Always consult the institution in charge of health-related matters to confirm any fishy information you come across.
The nature of and the manifestation of the Covid-19 disease is such that there’s only a little time available to remedy the situation before it gets chronic. Although the infection begins by exhibiting mild symptoms, if you do nothing in a short time, it could lead to death in a matter of days.
This whole picture has caused many to become desperate about Covid-related issues, launching into panic mode at the sight of any information. As a result, such people are not far away from falling for fraudsters.
With the different kinds of news flying around, you mustn’t be fooled by Covid-related scams.
The Coronavirus threatens the health of millions of people around the world daily, also killing thousands along the way. To curb the spread and remedy the situation, bodies like the CDC, WHO, and every country’s local health organisation like the NCDC, frequently circulate information around communities. However, it has also led to fraudsters taking advantage to provide fake news, and even asking for donations.
Each day, there seems to be a new account or NGO asking for donations into the health sector, and though some are legit, many are just fraudsters posing to take advantage of innocent citizens. So far, numerous complaints about scams have been recorded, especially with people who are looking to support the health cause in any way they can.
Channels used for COVID-related scams
There are three major ways scammers take advantage of the haziness of the situation to dupe people. To start with, they appeal to the emotions of humans, who see the high death toll and suffering. As a result of what is happening, people have been willing to donate funds for medical supplies, isolation centres, and financial compensation for medical workers.
Scammers take advantage of this by posing as charity organisations and solicit for funds. Most times, as soon as their target is met, they clear their footprint without leaving a trace behind.
Another way they scam people is by manufacturing and selling fake or low-quality health products. Everyone wants to get their hands on a cure, or something that can at least protect them from the virus, and scammers are meeting their needs by providing just that.
The World Health Organization currently approves only one vaccine, and any other thing outside it is outrightly fake or just a supplement that will help your body. Currently, only the Pfizer vaccine is clinically tested and approved to work. Be sure to not throw your money in the wind by purchasing some of these fake drugs around.
Lastly, scammers create systems to extract a patient’s personal information, thereby having access to the person’s true identity. It could be in the simple form of opening a registration portal where you supply all your details.
Therefore, only give information to approved bodies and not any random online site that appears legit. These fraudulent individuals can do a lot of damage to your identity. Stay vigilant, only communicate with approved bodies, and always ask questions if you are not sure or suspect foul play.
The place of electronics in COVID-related scams
These fraudsters usually reach out to you through the digital sphere. Hence, watch out for cold calls, text messages, or emails requesting donations to certain bodies. The best way to confirm the legitimacy of such a message is to visit the organisation’s official website in a different browser. Never follow the link in the mail or text directly, as it can be easily embedded with spyware. Therefore, a single click could see them extract all your personal information, including bank details.
Also, please stay away from those who claim to have a cure, and accompany it with testimonies of people who have used it. They are low graders desperate for your money. Vet them by searching online and see what people are saying. In all, always look out for suspicious messages, and opt out if you are sceptical.
In a nutshell, you should not believe any cure, vaccine or supplement that the World Health Organization does not approve of.
The government or legit health institutions do not cold call citizens to request donations or coerce them into making one. If you receive a call out of the blues, chances are it’s a scam, which is why they mostly try to hurry you to donate before you realise it. Always consult the institution in charge of health-related matters to confirm any fishy information you come across.
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