How to turn an idea, in to a business.
Discussion
Hi All,
So as per the title really, I have been walking around with an idea in my head for the last month or so, but having never done anything like this i don't know where to begin in order to take it any further.
The idea, without giving too much away is a platform / model that as far as i can tell takes from 2 sides of a market and stitches them together in a very simple way. I have researched and can not find anyone offering the same service although there are several that offer similar or alternatives but it is exactly the gap that they are leaving that my entire model revolves around.
Everyone has ideas now and then but the more I have discussed this with family, and put pen to paper to convince myself of how it would work, the more convinced I am that it would actually be a benefit to all users.
So I have produced a slides which shows how different pages of the app / website would appear / how it would work.
Written accompanying notes on where it fit in to the market, the benefits to users, example scenarios, that even just in the time I have been thinking about it, I have had 2 close friends approach me with the scenario I am trying to apply to.
Created high level Business plan, referenced all the numbers that i have used and mostly modelled my idea on worst case uptake in 5 yrs time of only 20% of customers of the closest competitor and it still seems more than feasible.
My question is, do I need to have the app or website created?
Where are good places to discuss investment, advertising etc.
Essentially I don't know who I can trust and tell my idea to hoping for investment without it being taken, and as it is not an "invention" I don't believe I can hold a patent, it is a combination of services that exist pieced together for convenience and ease of use.
Any advice welcomed,
Liam
So as per the title really, I have been walking around with an idea in my head for the last month or so, but having never done anything like this i don't know where to begin in order to take it any further.
The idea, without giving too much away is a platform / model that as far as i can tell takes from 2 sides of a market and stitches them together in a very simple way. I have researched and can not find anyone offering the same service although there are several that offer similar or alternatives but it is exactly the gap that they are leaving that my entire model revolves around.
Everyone has ideas now and then but the more I have discussed this with family, and put pen to paper to convince myself of how it would work, the more convinced I am that it would actually be a benefit to all users.
So I have produced a slides which shows how different pages of the app / website would appear / how it would work.
Written accompanying notes on where it fit in to the market, the benefits to users, example scenarios, that even just in the time I have been thinking about it, I have had 2 close friends approach me with the scenario I am trying to apply to.
Created high level Business plan, referenced all the numbers that i have used and mostly modelled my idea on worst case uptake in 5 yrs time of only 20% of customers of the closest competitor and it still seems more than feasible.
My question is, do I need to have the app or website created?
Where are good places to discuss investment, advertising etc.
Essentially I don't know who I can trust and tell my idea to hoping for investment without it being taken, and as it is not an "invention" I don't believe I can hold a patent, it is a combination of services that exist pieced together for convenience and ease of use.
Any advice welcomed,
Liam
1. Never publish your idea, or part-idea, in public. People will steal it. You need to delete 90% of the post.
2. Use ruthlessly every single free government resource out there, and also the paid ones (like local grants).
3. Stop dawdling. The longer you faff about, the likelier you are to fail.
4. Move to Central London. That's where the money and hunger are for startup onliners.
https://www.gov.uk/set-up-business
https://www.gov.uk/business-support-helpline
Good luck.
2. Use ruthlessly every single free government resource out there, and also the paid ones (like local grants).
3. Stop dawdling. The longer you faff about, the likelier you are to fail.
4. Move to Central London. That's where the money and hunger are for startup onliners.
https://www.gov.uk/set-up-business
https://www.gov.uk/business-support-helpline
Good luck.
The more you have developed the more your idea will be worth. So I would be trying to get at least a skeleton together.
There are some great resources now for start up businesses so I would do some googling/twitter and see if there are any free seminars/presentations in your area. Go to a couple and see what's what. With a bit of luck you will get some great advice or meet a mentor with contacts.
There are some great resources now for start up businesses so I would do some googling/twitter and see if there are any free seminars/presentations in your area. Go to a couple and see what's what. With a bit of luck you will get some great advice or meet a mentor with contacts.
Obviously it can be done - but the route is tortuous and the risk of someone stealing your idea is high.
You need to write a more detailed business plan that sets out the competitive landscape (the market), how you will meet the need, how long it will take to get there, the staging posts along the way and who is going to lift the heavy weights.
Within this plan you need to look at how much investment you will need and what the business might be worth in 3 years time.
Private Equity generally don't like pre revenue businesses (there are exceptions of course) and they will want to see that you've done a round of friends and family cash raising. Professional investors will also take a chunk of equity - which you can reduce as you hit your business plan numbers.
It's also worth saying that raising, let's say, £200k is so much harder than raising £20m. Weird as that sounds.
Starting from zero with an idea for an app is very hard work. Another route is to go to an app developer - if they like your idea then they would take equity in exchange for producing the app for you.
You need to write a more detailed business plan that sets out the competitive landscape (the market), how you will meet the need, how long it will take to get there, the staging posts along the way and who is going to lift the heavy weights.
Within this plan you need to look at how much investment you will need and what the business might be worth in 3 years time.
Private Equity generally don't like pre revenue businesses (there are exceptions of course) and they will want to see that you've done a round of friends and family cash raising. Professional investors will also take a chunk of equity - which you can reduce as you hit your business plan numbers.
It's also worth saying that raising, let's say, £200k is so much harder than raising £20m. Weird as that sounds.
Starting from zero with an idea for an app is very hard work. Another route is to go to an app developer - if they like your idea then they would take equity in exchange for producing the app for you.
Where to start?! 
some random thoughts...
Firstly - it sounds as though there could be something in what you say, so start by working out what you are prepared to spend in time / money to make it happen - and if you can't do it within that limit, then you have given it a go, and it hasn't worked...
There are lots of superficially good news stories about people who set up businesses / websites / apps and make their fortune - in reality it won't happen to you, most businesses go bust / close down in 2016 over 650,000 businesses were started in the UK that is 1% of the UK population (1.5% of working age) starting a business each year - yet c. 50% don't survive more than 5 years.
So be realistic - don't expect instant fortune - work out how to beat the odds
- be prepared to work hard - average small business owner works 50+ hours a week - and in start-up that will be much higher
- take advice - the best thing you can do is find a mentor - someone who has been there / done it before - it is the fastest (and cheapest) way to get experience into the business...
- be the engine - a business is powered by several things (of which the idea is a very small part) - the two main ones are funds to finance the business / time to make it happen - the more you can be the provider of both the time and the money, the more control you keep and the easier your finances will be...
- assume it will cost more - for every estimate / quote / expected cost, assume it will cost 50% - 100% more and you might get the figures right the biggest issue with most businesses is cash - availability and cashflow (amount and timing) - control your cash and you will buy yourself time...
- be cautious about investors - while it can seem very exciting and necessary to bring in investors - you immediately have people involved who have power to influence what you do / their own agenda (which will not be yours) / a loss of control - investors have one simple interest, to make money for themselves - not for you. If you have to have investment in order to scale - think it through very carefully
- people are the heart of your business - I have spent 30+ years starting and building businesses - both my own & advising hundreds of others, absolutely key to success - beyond the idea / financing / etc. is the quality of the people involved - build the right team and you will be taken more seriously / have a higher chance of success - everyone needs to pull their weight, and bring maximum value to the business...
your outline (and ignore Yipper there is nothing in your post to steal!) suggests though that currently you have a theory of a business - this means that you don't have a business yet. You need to start and build the business before you go and talk to investors - a theory is useless - go and watch some back issues of Dragon's Den - they invest in businesses where there is something tangible / where the person is investible - currently you have nothing tangible, and have not proven yourself investible - so go and start the business and then there might be scope for investment if it is required and not self-funding...
you mention a platform and two sides of a market - that is not an unknown concept in terms of what you are trying to do, so start by seeing if you can use readily available technology to start it working - you can build something bespoke later - e.g. would it work to simply have a closed community on a forum platform? If so, then cost is negligible - set it up and get it going. If you need something bespoke - have a chat with a web company to see what can be done - we wrote a trading platform for a private venture about 10 years ago - it cost our client £13k at the time - might be cheaper now if more code is available off the shelf - might be more expensive depending on what is wanted - but if costs were e.g. £10k - £20k could you fund that (even if you have to sell your car etc.)?
Ultimately the value of the business will be in:
- volume of those using it
- ownership of those people / their data
- volume / scale of transactions
- income you make
- etc.
so, the sooner you can build that platform and get it running, the better - it doesn't matter if it is not the ideal or perfect platform - if it is workable and meets a need, then it will take off - but far cheaper than feeling you have to start with the final polished product funded by investors...
so get on with it - self fund if you can - prove the concept as quickly as possible - show you can turn a profit...
then you will have a business which may or may not be worth investing in to take further...
some random thoughts...Firstly - it sounds as though there could be something in what you say, so start by working out what you are prepared to spend in time / money to make it happen - and if you can't do it within that limit, then you have given it a go, and it hasn't worked...
There are lots of superficially good news stories about people who set up businesses / websites / apps and make their fortune - in reality it won't happen to you, most businesses go bust / close down in 2016 over 650,000 businesses were started in the UK that is 1% of the UK population (1.5% of working age) starting a business each year - yet c. 50% don't survive more than 5 years.
So be realistic - don't expect instant fortune - work out how to beat the odds
- be prepared to work hard - average small business owner works 50+ hours a week - and in start-up that will be much higher
- take advice - the best thing you can do is find a mentor - someone who has been there / done it before - it is the fastest (and cheapest) way to get experience into the business...
- be the engine - a business is powered by several things (of which the idea is a very small part) - the two main ones are funds to finance the business / time to make it happen - the more you can be the provider of both the time and the money, the more control you keep and the easier your finances will be...
- assume it will cost more - for every estimate / quote / expected cost, assume it will cost 50% - 100% more and you might get the figures right
the biggest issue with most businesses is cash - availability and cashflow (amount and timing) - control your cash and you will buy yourself time...- be cautious about investors - while it can seem very exciting and necessary to bring in investors - you immediately have people involved who have power to influence what you do / their own agenda (which will not be yours) / a loss of control - investors have one simple interest, to make money for themselves - not for you. If you have to have investment in order to scale - think it through very carefully
- people are the heart of your business - I have spent 30+ years starting and building businesses - both my own & advising hundreds of others, absolutely key to success - beyond the idea / financing / etc. is the quality of the people involved - build the right team and you will be taken more seriously / have a higher chance of success - everyone needs to pull their weight, and bring maximum value to the business...
your outline (and ignore Yipper there is nothing in your post to steal!) suggests though that currently you have a theory of a business - this means that you don't have a business yet. You need to start and build the business before you go and talk to investors - a theory is useless - go and watch some back issues of Dragon's Den - they invest in businesses where there is something tangible / where the person is investible - currently you have nothing tangible, and have not proven yourself investible - so go and start the business and then there might be scope for investment if it is required and not self-funding...
you mention a platform and two sides of a market - that is not an unknown concept in terms of what you are trying to do, so start by seeing if you can use readily available technology to start it working - you can build something bespoke later - e.g. would it work to simply have a closed community on a forum platform? If so, then cost is negligible - set it up and get it going. If you need something bespoke - have a chat with a web company to see what can be done - we wrote a trading platform for a private venture about 10 years ago - it cost our client £13k at the time - might be cheaper now if more code is available off the shelf - might be more expensive depending on what is wanted - but if costs were e.g. £10k - £20k could you fund that (even if you have to sell your car etc.)?
Ultimately the value of the business will be in:
- volume of those using it
- ownership of those people / their data
- volume / scale of transactions
- income you make
- etc.
so, the sooner you can build that platform and get it running, the better - it doesn't matter if it is not the ideal or perfect platform - if it is workable and meets a need, then it will take off - but far cheaper than feeling you have to start with the final polished product funded by investors...
so get on with it - self fund if you can - prove the concept as quickly as possible - show you can turn a profit...
then you will have a business which may or may not be worth investing in to take further...
Edited by akirk on Friday 9th February 13:02
I've built 3 startup businesses to profitable multimillion t/o over the past 3 years and am very good in new markets and concepts.
Happy to sign an NDA/Non compete (you can probably download templates from Rocket Lawyer or similar if you don't have them).
Can give an honest opinion on whether it has legs if you would like to email me through my profile.
Happy to sign an NDA/Non compete (you can probably download templates from Rocket Lawyer or similar if you don't have them).
Can give an honest opinion on whether it has legs if you would like to email me through my profile.
Frimley111R said:
janesmith1950 said:
I've built 3 startup businesses to profitable multimillion t/o over the past 3 years and am very good in new markets and concepts.
3 businesses from £0 to multi millon pound t/o in 3 years?!! Tell us more!
- set up company A
- set up company B
- set up company C
go to the city
offer £10m in cash for each business to anyone who gives me £2m each to buy a widget from each company
instant multimillon t/o
If it's really just a platform with a two sided market then the likelihood is that there is not much that could be protected to stop someone copying your idea. For example - anyone could copy Airbnb, Monster, Rightmove, etc.
The key to coming out on top is to get close to your market and execute the idea better than anyone else. Again to take Airbnb as an example - the founders spent 6 months using their own platform to stay with strangers, gather feedback and see what worked and what didn't.
Another way of saying this is that the idea is close to worthless:
If you want to get developers on equity then you need to be bringing something else to the table - industry knowledge, marketing experience, etc.
Lastly, read The Lean Startup. You'll learn how to test the market and build a Minimum Viable Product based on customer feedback.
Oh - and if there is truly no one else doing your idea then that would be a massive red flag. It means one of two possibilities:
The key to coming out on top is to get close to your market and execute the idea better than anyone else. Again to take Airbnb as an example - the founders spent 6 months using their own platform to stay with strangers, gather feedback and see what worked and what didn't.
Another way of saying this is that the idea is close to worthless:
If you want to get developers on equity then you need to be bringing something else to the table - industry knowledge, marketing experience, etc.
Lastly, read The Lean Startup. You'll learn how to test the market and build a Minimum Viable Product based on customer feedback.
Oh - and if there is truly no one else doing your idea then that would be a massive red flag. It means one of two possibilities:
- The chances of you coming up with a truly original idea are close to 0, so it means other people have tried and failed. Find these failures and learn why they didn't work.
- If it IS a truly original idea then it means you'll need to educate your market, which can be difficult/expensive.
Some good advice here, but ignore the advice about deleting you first post. It's also highly unlikely that anyone will want to copy your idea UNTIL you have a runaway success...then expect a swarm of imitators! it's a common misconception..unless you've reinvented the wheel with a working prototype, or have a strong background / credibility in your industry, nobody is interested in unproven ideas.
In answer to your specific queries, try your local chamber of commerce. They might arrange events / advice for start ups, and can signpost you to the organisations active in your area offering advice / support. Good advice above about Central London...or alternatively Birmingham, Manchester or Edinburgh if you can't do London, all of which have a tech start up scene. Try looking on EventBrite to see what's on.
You should develop a basic / wireframe website to demonstrate how your platform might work. Don't rush out and develop the app / website. Speak to potential customers and those in your industry - the opinions of family and friends don't count and can send you down a blind alley.
Make sure you can explain your idea / business in a couple of sentences. Concentrate on what the benefits to customers are and what problem you are solving for them. I've fluffed pitches before because nobody knew what I was talking about!
In answer to your specific queries, try your local chamber of commerce. They might arrange events / advice for start ups, and can signpost you to the organisations active in your area offering advice / support. Good advice above about Central London...or alternatively Birmingham, Manchester or Edinburgh if you can't do London, all of which have a tech start up scene. Try looking on EventBrite to see what's on.
You should develop a basic / wireframe website to demonstrate how your platform might work. Don't rush out and develop the app / website. Speak to potential customers and those in your industry - the opinions of family and friends don't count and can send you down a blind alley.
Make sure you can explain your idea / business in a couple of sentences. Concentrate on what the benefits to customers are and what problem you are solving for them. I've fluffed pitches before because nobody knew what I was talking about!
akirk said:
a business is powered by several things (of which the idea is a very small part) - the two main ones are funds to finance the business / time to make it happen - the more you can be the provider of both the time and the money, the more control you keep and the easier your finances will be...
Basically this. The idea is worth f
k all. And question (hard) why the others in the market(s) haven't made the connection you have. There are very few original ideas, just differences in execution. I'd bet my house others have explored the idea already. There might be a gap in the market but is there a market in the gap? Why are they not doing it? Does cost of development outweigh what they can make doing it the normal way?We started a business last year with £300 which has been self funding since. Totally run of the mill standard product everyone has and there are many many competitors. But the idea was to test our angle and approach on a shoestring, and build more slowly than we would if we throw cash at it. The idea of taking someone's £100k or £1M and having the stress that goes with that on an untested product isn't one for me. I've seen what some people spend on app development and it scares me.
And ignore Yipper, he talks a power of s
te. Like nobody can start a business outside London ffs?These are all very good inputs.
But I must disagree with 'They will steal your idea'.
I have always freely spoken to people about my ideas (that have been profitable) and no one has even touched them.
People have morals and they probably can't see what you can. Or they don't have the energy to chase it.
Even in the greatest startup book(imo) "The Lean Startup" Eric Ries clearly states that no one will steal your idea, and if they do, you're doing something great.
But I must disagree with 'They will steal your idea'.
I have always freely spoken to people about my ideas (that have been profitable) and no one has even touched them.
People have morals and they probably can't see what you can. Or they don't have the energy to chase it.
Even in the greatest startup book(imo) "The Lean Startup" Eric Ries clearly states that no one will steal your idea, and if they do, you're doing something great.
Apologies if this has been addressed but: "I don't believe I can hold a patent, it is a combination of services that exist pieced together for convenience and ease of use. "
- don't be so sure! a 'novel use of an existing technology' can be patented. You can talk to a patent attorney in the UK, initially for free, in complete confidence as they're bound by the Rules of Conduct set by the Chartered Institute of Patent Attorneys (CIPA) - as long as the one you choose is a member.
Further, when it comes to the crunch and an investor shows interest, don't ask *them* to sign an NDA - as you're effectively asking them for their money whilst assuming they're a potential criminal/fraudster/thief!
You can go ahead and find a P.A. right now who you can speak to FOC who will give you a clear idea of whether there is 'prior art' (an existing patent) but be aware that PA's are indemnified from action against them due to them inadvertently providing you with incorrect search results, as there may be a patent application underway which hasn't been disclosed yet, which won't yet show up in their search results.
If you're anywhere near one of the British Library's BIPC outfits around the country, you can get a much lower cost patent search carried out for £100-£120 rather than the multiple hundreds charged by P.A.s.
- don't be so sure! a 'novel use of an existing technology' can be patented. You can talk to a patent attorney in the UK, initially for free, in complete confidence as they're bound by the Rules of Conduct set by the Chartered Institute of Patent Attorneys (CIPA) - as long as the one you choose is a member.
Further, when it comes to the crunch and an investor shows interest, don't ask *them* to sign an NDA - as you're effectively asking them for their money whilst assuming they're a potential criminal/fraudster/thief!
You can go ahead and find a P.A. right now who you can speak to FOC who will give you a clear idea of whether there is 'prior art' (an existing patent) but be aware that PA's are indemnified from action against them due to them inadvertently providing you with incorrect search results, as there may be a patent application underway which hasn't been disclosed yet, which won't yet show up in their search results.
If you're anywhere near one of the British Library's BIPC outfits around the country, you can get a much lower cost patent search carried out for £100-£120 rather than the multiple hundreds charged by P.A.s.
CasioPasio said:
But I must disagree with 'They will steal your idea'.
People have morals and they probably can't see what you can. Or they don't have the energy to chase it.
Agreed, but not because they have morals, if there's money people WILL steal/copy it. The reason is more that there isn't money in it (at the moment), they're not personally invested and they're busy doing something which does make money. Why bother?People have morals and they probably can't see what you can. Or they don't have the energy to chase it.
Firstly, thank you all for the responses, if I am honest I expected considerably more negativity, so the helpful and positive nature of all these responses is much appreciated.
I will take on board the comments and improve my business plan, and create a web based platform initially. I have friends in the market who I will discuss this with further and get them on board to create a working example.
To those who have offered their time, thank you, I may well be in touch soon once I have created something tangible.
I am only too aware that an idea is just that, my concern with investment is that as a platform, it is only really worth talking about if it has a reasonably large uptake, something that will not happen over night, and I will likely need to invest in marketing or partner with a similar service in order to reach the customer base I am aiming for.
I will take on board the comments and improve my business plan, and create a web based platform initially. I have friends in the market who I will discuss this with further and get them on board to create a working example.
To those who have offered their time, thank you, I may well be in touch soon once I have created something tangible.
I am only too aware that an idea is just that, my concern with investment is that as a platform, it is only really worth talking about if it has a reasonably large uptake, something that will not happen over night, and I will likely need to invest in marketing or partner with a similar service in order to reach the customer base I am aiming for.
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