The Business 360 Podcast with Rushab Kamdar

#25: How To Choose The Right Business Idea

November 08, 2021 Rushab Kamdar Season 2 Episode 25
The Business 360 Podcast with Rushab Kamdar
#25: How To Choose The Right Business Idea
Show Notes Transcript Chapter Markers

Do you have too many business ideas? 

If you are like most entrepreneurs, then you are on that hamster wheel of trying to decide which one of your business ideas is the right one to pursue?

In Episode 25, we dive into WHY it’s important to choose “one” idea, followed by HOW you can choose the right one for you.

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Welcome to the Business 360 podcast where we will take a 360-degree view of all things business in under 15 minutes. I'm Rushab Kamdar a serial entrepreneur consultant, speaker, and business strategist. I help entrepreneurs and businesses get profitable while also saving them time, money and headache.

Hey there, business heroes. Welcome to episode 25 this week. We're going to talk about a scenario that almost every person with an entrepreneurial spirit has gone through and that's having too many business ideas and not knowing which one to pursue. As I've stated before to date, I've owned companies.

So believe me, when I tell you that I've been on that hamster wheel of too many things. And just not knowing which one I should go after. There are some people who can start in one multiple businesses at the same time, they're called serial entrepreneurs, but being a serial entrepreneur isn't for everyone.

See, for most entrepreneurs, it's counter-intuitive to run multiple businesses simultaneously. The reason being is that in the early stages of your startup, things can get quite hectic in case. Most entrepreneurs find difficulty in being organized and finding time to do their tasks when running just one business.

So can you imagine the challenges and running multiple businesses at the same time? I consider myself a serial entrepreneur because I have run multiple businesses simultaneously in the past. And I'm running two companies right now, but I'm only able to do this because I knew my limitations and what's manageable.

I already had a process and methodology in place. I always advise my clients to focus on one business because it allows you to put your energy and effort towards it. You won't be distracted. You won't be disorganized. You won't be overwhelmed. And most importantly, you won't be burnt out. Businesses, cost money.

Even if you bootstrap, the trade-off for saving time is spending more money. Therefore. Having multiple businesses means less time and therefore, more of a strain on your wallet. The last thing I will say is that the benefit of focusing on one business is that the quality of your product, your company culture and your customer support will be significantly higher.

So now that you know the why on focusing on one business, let's talk about how to choose the right. From the many ideas that you have, and I'll draw from my own experience because at one point I was honing four businesses at the same time and it's something I will never recommend to anyone. So these are the steps that I took to hone in on which business I really wanted to focus on.

And these steps are also ones that I've taught my clients. So let's get. First I looked inward and identified my skills experience and passion. I recognize that it's a lot easier to build and grow a business, doing something I enjoy and that I'm good at. Then I took a good look on the demand for the products and services my businesses were offering.

Although we say, follow your passion, it doesn't mean we should follow. There has to also be a market for it. And if there wasn't a market or I wasn't attracting enough customers, then I would have to move on from that business or pivot. See it's important to validate customer demand. Now the third thing I did and it's very important and I don't think a lot of entrepreneurs do this, I looked at the lifestyle I wanted to.

And I'm not talking about dreaming of having a mansion and sports cars. I'm talking about a day-to-day lifestyle. If you enjoy having your weekends off, then don't open up a restaurant. So I looked at which business will adversely impact my lifestyle, my desired lifestyle. And that helped me narrow my choice.

Next, I, again, looked inward and determined my risk of. See, everyone is different. Some people are able to take large risks and others just cannot. If you are a risk-averse person, then look into businesses that are in your comfort zone. I know many first time entrepreneurs who started out by buying into a franchise.

Because they want it to get support from the franchisor. One of the strategies I use to mitigate my risk was getting a partner in one of my businesses, because we were able to share the support and the resources and our effort. After I determined my risk appetite, I started getting a clearer picture on which business I wanted to focus on.

So the next thing I did was flesh out the potential of my business. Now, what I mean by that? Is asking and answering a few questions such as is my idea marketable. Can I afford the startup costs? Can I compete with the other competitors in my space? Do I have customers ready and willing to pay for my product?

See, every entrepreneur thinks that their business idea is the best idea out there, but the market may not think so. Therefore it's important to flesh out the ideas as thoroughly as. Now we're coming to the last two things I did to decide which business is right for me. I looked at whether my business idea imposes any financial limitations on me.

If I don't have the funds to set up the business and grow it either through hiring or marketing that I may have to reconsider, you have to look at your current capital position. You don't want to be in a position where you put a lot of money into a business that just may fail. And now you're drowning in.

Finally, I looked to see if my business has longevity. This means is it sustainable? I didn't want to get into a business or an industry that made his die in a few years or that the industry is a fad and consumers will move on from it very quickly. I want it to have a business that will have a demand every year.

Do you remember fidget spinners that fad died? What I want you to take away from this episode is that I know you have many amazing business ideas, but it's important to focus on one. Your business will take a lot of your time, energy, and effort. So you don't want to spread yourself too thin. And when you go into that journey of choosing the right business, make sure you go through the exercise that I just went through.

So I'm going to recap those steps for you. So take a moment, go grab a pen. There were seven strategies I laid out for you. First, identify your skills, experience and passion. Second. Validate the customer demand. Third, make sure the business aligns with your lifestyle. Fourth. Determine your risk appetite.

Flush out the potential of your business, six acknowledged your financial limitations and number seven, focus on the long-term sustainability of your business. That will just about do it for this episode. Be sure to join us for next week's episode, where we're going to talk about strategies and getting profitable.

Thanks for listening. And you stay classy. Business heroes.