Do you know someone who will create the next big startup "if only I have THE ONE BIG IDEA!", the same person who also told you last week "business ideas are a dime a dozen, execution is everything!"?
Well, I have to admit that person was me the past few years. Until November of 2020 actually, when I came across the concept of Micro SaaS from Tyler Tringas, and decided give it a shot myself. If you have not heard of a Micro SaaS, it is as the name suggests, a very small SaaS usually created by a solo founder.
While looking around for some Micro SaaS idea inspirations, I came across Tyler's Ideas Meat Grinder Post, where he mentions:
First of all you should be coming up with at least five possible business ideas every day...You should be constantly thinking this way.It should annoy people who spend a lot of time around you...If you’re not doing that, you’re probably not going to be an entrepreneur.
I was not constantly thinking about new business ideas.
So, naturally, I decided to put Tyler's theory to test.
Every weekday since, I took some time to sit down and write down 5 business ideas, no matter how terrible, for a month and a half. I tried various questions, themes, and technologies, and here are some lessons I learned along the way.
Disclaimer: this is a post about lessons I learned from my practice of daily business idea generation, I am not a successful starter and do not claim to be an expert at coming up with new business ideas. Some ideas I came up with are hilariously bad (like ChewMote: the dog proof remote cover).
Start With Your Customers
When I first started the practice I used Tyler's list of meat grinder questions to evaluate business ideas:
1. Problem
2. Idea
3. Can I make this?
4. Are people currently spending money on it?
5. How will I get the first 25/250 customers?
6. Will it be sustainable?
7. Am I the person to build this business?
It soon became clear that as a software developer, question 5 is the real hurdle for my ideas.
It turns out there are only 10 ways to rearrange Hacker News, Product Hunt, SEO, and Subreddits without repeating myself.
Since the goal is to create a Micro SaaS, working on a product without a 250 customer market is almost never an issue. Even a kooky ideas like a real time running trail condition app for Denver Colorado has 250 potential paying users out there, and one can always expand the idea to other locations. Let's call the theoretical trail condition app MudGuard, its main feature is a list of popular trails and whether they are too muddy or icy to run on. The real challenge with MudGuard is how to reach those Denver trail runners who cares if the trails are too muddy, and it is not going to be via Hacker News, Product Hunt, SEO or /r/trailrunning.
The other popular idea generation technique I tried is to start with a piece of technology and find problems it can solve. I tried this with generative adversarial networks (GAN) as I was learning about them at the time and came up with some ideas that don't seem too terrible on the surface. For example, GANfidence uses GANs to produce videos of people performing some task at a high level to improve learning. I have an idea of who the customers are too, professional athletes, sales folks, weekend golf warriors. Here too, question 5 is the real test, I have no idea how to reach performance coaches for my target customers and it's a customer base I have no direct access to. It's a bad Micro SaaS idea for me.
Lesson 1: start with a customer base you know and have some access to, especially if you want to bootstrap a SaaS.
And this naturally leads us to...
Scratch Your Own Itch
Remember the MudGuard app I mentioned earlier? It turns out the Denver Trail Runners Facebook group is extremely active and has 5.3k members, and the Golden Trail Runners Meetup group has 1.1k members. There are also a number of specialty running shoe stores near by that regularly schedule trail runs I can market the app at.
I know these things because I'm a trail runner in Denver and I often worry about which trails are dry during the winter months.
"Scratch your own itch" is so often recommended as an idea generation tool that it's a cliche at this point. But when you are trying to come up with X ideas per day, it's an extremely powerful tool because it answers so many other questions at once:
1. Since it is an itch for you, there's at least person who will want to pay for it. I like ideas that I know I will pay $5 for on the spot if a solution exists.
2. The itch is usually a problem that you share with some other subset of people, and often times it's a group that you have free marketing channel access to. It's much easier for me to do customer validation on the hypothetical trail running app than a scuba diving app as a non-swimmer.
3. I am more often than not the right person to build an app that solves my own problems. Scratching your own itch and an itch of those people who you share a trait with is intrinsically rewarding.
Now I am not saying that I always needs to scratch my own itch, in fact I am a huge fan of Amy Hoy's Sales Safari idea (affiliate link, you can see a video of it in action here). With the Sales Safari, you go to online communities where your target customers hangout (watering holes) and do a days long deep dive on their needs and wants. It's not hard to see why all that research would lead to good business ideas. But when I am trying to come up with 5 ideas a day, it's simply not feasible to that level of in-depth research.
Lesson 2: If the problem is your own itch, then you are often already half the way to a decent idea.
But MudGuard is still not a good business idea, that's because...
Welcome Competitors
During the winter months I would check the weather mid morning to see what the temperature is like the rest of the day, pick a trail and leave the house in the early afternoon. A quick check of MudGuard for trail condition would fit naturally in that workflow, but even I am not sure I would pay for it, and definitely not in monthly subscription fees.
Maybe I am just a cheapskate, or maybe that's the problem of coming up with 'novel ideas'. You never know if anyone will pay for them.
Or will they? It turns out there are competitors for MudGuard out there. For example, TrailFork is a great site and app that shows trail condition for lots of popular trails near me and has a paid version of the app. Now that we know there are paying customers for our idea, we know we are no longer dealing with a new market and all the hassle that entails. We now know our itch is itchy enough to be a paying pain point for others, making it much more promising.
Fear of competitors is a good example of a major issue of mine when I first started writing down ideas. The logical side of me knew the correct answer is to embrace competitors, I can hear the little voice inside of my head saying
"Of course you should welcome competitors, that means the market is validated"
But my gut hated the idea of competitors, there's something about the emotional comfort of a pristine pasture market all to myself that I couldn't shake off. It took a few weeks and many ideas to embrace competitors both logically and emotionally, but eventually my did learn that no competitors means there are likely no paying customers either.
What competitors mean is you now have what Steven Blank termed a resegmented market. The hard work of creating a market is already done for you and you can focus on your competitive advantage instead. This can be on price, or in the case of a Micro SaaS, on a niche that the larger players overlooked.
Go lookup how many tattoo and mechanic shop CRM platforms are out there, I'll wait.
Lesson 3: With practice your gut will like competitors as much as your head does.
Now that even I wouldn't pay monthly for MudGuard, what about...
Go Where the Money Is
Arvid Kahl mentioned the follow criteria for finding critical problems that people will pay for (from his great bootstrap guide Zero To Sold):
- If the solution saves them time
- If the solution saves them money
- If the solution makes them money
Notice how two of the three criteria contain the word money (and remember the saying 'time is money'). There are many important services in my daily life that I do not pay for, like a good dog petting in the morning, but a business will do far better trying to lower my rent than make my dog petting more efficient.
As a software developer, it's more natural for me to think in terms of cool new technologies and new ways of using existing technologies than in terms of money exchanging hands. But there's no better way to sustain a business than to be in the middle of a money making workflow, make the process better and taking a cut of the efficiencies gained.
Money changing hands isn't just about sales and paying taxes. All things being equal, a tool that automatically dials sales calls leading to 2% efficacy gain is easier to sell than one that reminds you to call your mother and does the dialing automatically. The key is to be an integral part of the money making / money spending workflow.
Lesson 4: When in doubt, go to where money is being made or spent.
And that leads me to the final lesson....
You Get Better At It
Around mid-January 2021 I stopped generating 5 new ideas a day and toned it down to 1 idea per day. This is both so I can spend more time doing in-depth customer / competitor research and because I started to notice a change in my day to day routine. I had started to come up with business ideas automatically throughout the day, and simultaneously run a quick filter for the various evaluation question almost subconsciously. While I still had to force myself to sit down and fill out all 5, I would often have a few ideas already banked throughout the day.
It reminds me of what Paul Graham once said about startup ideas, that part of the key is just to 'notice... things that seem to be missing'. I can only compare it to how mindfulness meditation can help you notice your emotional state. I got better at noticing the complaining, idea generation, idea evaluation process, it became a habit.
Lesson 5: You can get better at creating new ideas if you practice.
I wish I can travel back in time a few years and tell my younger self to practice coming up with new business ideas daily
It's easy man! You just find a few things to complain about everyday and make up a solution for them!
But of course, I know now and I knew back then my obsession with THE ONE BIG IDEA was just an excuse for inaction.
But what if the opposite is also true?
What if the practice of coming up with business ideas daily can be the first step on a successful starter's journey?
I've found the practice of daily idea creation so helpful that I created Kata Club, a place where people can practice daily and take the free Kata 30 Challenge. Kata is the Japanese word for a set of martial arts movements, often practiced daily. The movements are drilled until they become second nature during combat.
You can also find all my ideas on Kata Club, along with any other user submitted public ideas.
Hope this post has intrigued you enough to give daily idea creation a try.
If you have any feedback for Kata Club or this post, leave a comment or tweet at me @ItsTrueInTheory.