UNDERSTANDING THE FIT BETWEEN OPPORTUNITIES AND IDEAS

Fitting opportunities to ideas

New ventures aren't conceived in one sitting. Every new venture starts with a perception of an opportunity and the small seed of an idea. During the entrepreneurial journey that follows, this initial hunch will be investigated and developed, reality-tested, corrected, investigated and developed a bit more, reality-tested again and so on. The process continues until an entrepreneur feels enough certainty about the potential value of the idea to think investing time and money (her own and other people's) in it worthwhile – or else discards it as unfeasible.

Before anything else, your venture will rest on two essential ingredients: the identification of a good opportunity and a solution to exploit that opportunity. This stage of your entrepreneurial journey – the idea stage – introduces you to the early building blocks for finding these two ingredients.

The first thing you'll do on your journey – and the first thing an investor will eventually ask you to do when you come to meet one – is to outline your opportunity and your solution. So we devote two chapters to introducing different ways of finding and assessing opportunities and solutions. This isn't a one-off exercise, however; you'll refine your opportunity definition as you move through the subsequent stages of your journey, exploring all the factors that could help or hinder your business.

Most of this book is about testing, elaborating and modifying your initial idea about your opportunity and your solution. This first section is devoted to making a few early and basic decisions about your idea(what the business might sell, or several variations) and why it may be a sellable business proposition (the opportunity), using information you already have or can obtain fairly easily, mixed with a bit of your intuition. Later sections of the book are devoted to gathering more information to test your early assumptions.

Many aspiring entrepreneurs move straight from this early idea stage into writing a business plan, and will selectively seek out information that backs their original idea. We do not recommend this approach. Like the first draft of a document, your first idea is more of a hypothesis than a reality, and likely to need retuning before it becomes a proposal for a viable business. Stage 1 helps you make your idea clear and concrete enough for you to start i