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There is more to business than just a great idea, but coming up with that great business idea is a solid start. If you’re looking for a profitable business idea, here are six ways to hatch ideas and separate the good ones from the future flops.
I have three simple criteria for my businesses:
- They have to be reasonably complex so they are not easily replicated,
- They need to be scalable beyond the limited number of hours in a day, and
- They need to have a steady cash flow.
1. Ideas rarely materialize out of thin air.
Occasionally you may be struck with inspiration from seemingly nowhere, but a good business idea needs more substance to it than shiny appeal. Sometimes your idea imitates a successful, easy-to-copy business concept, but then you may find yourself facing heaps of competition in record time.
I was able to identify which of my business ideas simply sounded good, and which ones had actual potential by applying the three criteria listed above. I knew I didn’t want to start a business that any entrepreneur could easily copy the minute my idea was up and running. I also didn’t want to use a business model that would limit my earnings to certain hours of the day or a certain selling season. The criteria worked—my first startup grew into a profitable small business.
After establishing a few more successful businesses, I eventually started Patriot Software (a Software as a Service or SaaS business). Patriot is an online accounting and payroll software company with infinite scalability and a subscription-based revenue model.
2. Failure can actually be good for your business.
You’re going to fail in business. Even if you start a business and it runs successfully overall, you will still have small setbacks. Failures will cause you to scratch your head and reevaluate what you’re doing and why. These are your best opportunities to learn and grow, so embrace them.