Aspiring entrepreneurs often get stuck in the business idea phase — that is, they’re confident they could run a killer business, make a ton of money, and live the good life — if they could only come up with the right idea.
If that’s you — the idea seeker — I’ve got good news for you: coming up with new business ideas is actually pretty easy.
It’s what comes next that’s hard!
But today, let’s go through some of the proven methods you can use to come up with your first (or next) business idea.
1. The Rip, Pivot, and Jam Method
I first heard of this method from one of my favorite podcasts, the Tropical MBA show.
Here’s how it works:
- you look at another successful business, and copy their business model (rip) …
- but apply it to a new industry or vertical (pivot) …
- and then hustle like crazy to get customers (jam).
My friend Gabe Arnold used this method after seeing the success of WP Curve, a monthly subscription service that offered unlimited WordPress support. He decided to rip that model, pivot it to provide a content writing service, and jammed to grow it to $20,000 in monthly recurring revenue.
Alexandra Kenin saw plenty of bike tours, bus tours, walking tours, and even Segway tours in her adopted hometown of San Francisco, so she had the idea to offer an “urban hiking” tour. Now her company hosts 1000 urban hikers a year and she’s even gotten a book deal out of her not-so-little side hustle!
2. The Sniper Method
Some businesses are like shotguns and others are like sniper rifles.
Let me explain.
When you fire a shotgun, it sprays out a wide net of ammunition. In contrast, a sniper rifle fires a single deadly projectile.
Both weapons have their time and place, but for entrepreneurs just starting out, it makes more sense to think like a sniper.
For example, if Amazon is a shotgun; Travis Marziani’s BDancewear.com is a sniper rifle. Instead of selling every product imaginable, they only sell dance clothing.
That means they can do more targeted marketing and they appear more relevant and authoritative to the right customers.
I used The Sniper Method when I was building my first official side hustle, a comparison shopping site for footwear.
There were dozens of other comparison shopping sites out there, like NexTag, PriceGrabber, and Shopping.com, but they all were shotguns. They tried to include every product under the sun, and as a result, left opportunity for a sniper like me.
(It’s purely coincidental my site was eventually called ShoeSniper.com.)
I reasoned that by focusing solely (pun intended) on shoes, I could deliver more accurate search results, negotiate exclusive deals, and appear more relevant to customers.
3. The Shovels in the Gold Rush Method
Perhaps you’ve heard the advice, “In a gold rush, sell shovels.” The phrase comes from Sam Brannan, allegedly California’s first millionaire, who brought news of gold to San Francisco.
But before he made his announcement, Brannan bought up all the picks and shovels in the city, so he could resell them to hopeful prospectors.
And even though this happened more than 150 years ago, gold rushes still happen all the time. We’re just not looking for literal gold in the ground anymore; we’re looking for it in the form of the latest trend or hot fad.
In online business, I’ve seen gold rushes around ebay, niche sites, self-publishing, t-shirts, Amazon FBA, and more. And every time, some of the best businesses to come out of these rushes are the supporting services.
For instance, a ton of businesses have been built exclusively to serve Amazon FBA sellers. These are product research services like Jungle Scout, inventory management tools like Inventory Lab, and price scanning tools like Profit Bandit.
So to use the Shovels in the Gold Rush method, you just need to find a gold rush to support. Maybe that’s Airbnb hosts, maybe it’s Crossfit “box” owners, maybe it’s people getting into the latest network marketing trend.
Think of what common problems they have? Or, if you’re in the gold rush yourself, what problems do you have?
“Find a hot trend and piggyback on it,” Toni Anderson told me, who successfully used the “Shovel” method to sell bracelets and diffuser necklaces into the essential oil gold rush. It turned into a 6-figure business in 7 months.
4. The Intersection Method
The Intersection method aims to find potential service business ideas at the intersection of:
- Your skills
- Your interests
- Your network
For example, I started a freelance book editing business using this exact method:
- I thought I was a decent writer and a decent proofreader (hey, I was an A-student in English), even though I’d never been paid for it.
- I was interested in reading non-fiction (specifically business) books, and had even written a handful myself.
- I was in Facebook groups with other self-published authors.
It worked well and was a fun little side hustle experiment. I read some great (and some not-so-great) books and earned some extra cash.
To play around with this, get out a piece of paper and make 3 columns.
In the first, list your skills.
It might help to refer to your resume for this one. For instance, I’d put down experience from my past jobs like ski instructor, shelving books, painting houses, and inside sales, plus some of what I’ve learned on the side like WordPress, SEO, and podcasting.
In the second column, list your interests outside of work.
What do you enjoy doing? For me this column would include items like playing softball, skiing, traveling, learning, or even parenting.
In the last column, list out the who you know, or rather the types of people you know.
I don’t mean listing out everyone by name, but look for common threads on where they work and what they do.
Today, my network includes a lot of bloggers, podcasters, authors, freelancers, and ecommerce sellers, but I could also include engineers (my wife’s coworkers), photographers, parents, and car dealers (from my old job).
Next, you can play the matchmaking game to see if there might be an intersection to combine items from the 3 columns into a potential business idea.
Note: You can actually substitute a platform like Fiverr for your network if you don’t have any connections with potential clients. This is what Kendell Rizzo did when she combined her skill of copywriting with her interest in crowdfunding to create a lucrative side hustle ($100k in profit in 18 months).
5. The Scratch Your Own Itch Method
Solve your own problem, the saying goes, because other people are probably facing the same issue.
This one is easy. For the rest of the day, just keep a mental note of all the things that frustrate you, that you spend money to solve, or that you wish you didn’t have to deal with.
All of those are potential business ideas.
For Erin Chase, she was looking for ways to cut her family’s grocery budget, and ended up getting serious about meal planning. She posted her meal plans online, and they ended up going viral! Turns out, her pain point struck a nerve with a lot of other families as well.
Steve Young’s side hustle was building smartphone apps, but he wanted to know how he could get more downloads and sales. So he started the Mobile App Chat podcast (now called AppMasters) to talk to other more successful app developers and get their advice.
He hustled mornings, lunch breaks, and evenings to record episodes and grow his listenership. Since then, that little part-time podcast not only helped him sell more apps, but’s turned into a full-time business on its own with multiple streams of income.
And finally, Perrin Carrell found himself the proud owner of a new adopted puppy. But when he started looking around online for the best kind of food for his new best friend, he was disappointed in the results.
So he thought, if none of the existing dog blogs have truly exceptional content, maybe I could build one to fill the void.
6. The Expert Enough Method
What do your friends, family, and peers ask you for help with?
Are you the go-to person in your circle for tech support, photography, handyman work, accounting, BBQ technique, travel planning, or something else?
If people are asking for your help, they think you’re Expert Enough. (Now they might not be willing to pay for you advice, but that doesn’t mean others won’t.)
Mechanical engineer Matt Bochnak was always tinkering in his garage with motorcycles — his own and his friends’. One day he wondered if anyone would pay for his Expert Enough repair service, and sure enough, his ad on Craigslist started to draw in new customers.
And the other smart thing Matt did was set up a camera to film himself doing the repairs, which has led to a profitable YouTube channel and even selling full repair walkthrough video files online, effectively turning a service business into a passive income business.
Colin Jones had an entirely different skillset people kept coming to him for advice on: counting cards. He and his blackjack teams won nearly $4 million from casinos, so he set up a website to teach others his expertise.
7. The Probing for Pain Method
The Probing for Pain method can be incredibly profitable if you know how to ask the right questions.
How this generally works is calling up a business owner — could be someone you have a previous relationship with or someone you’ve never met — and asking questions like:
- Tell me a little about your business?
- What’s the biggest challenge facing your industry over the next 5 years?
- What does a typical day look like for you?
- What’s the most frustrating or time-consuming part of your business?
What you’re trying to do is uncover an expensive problem, as Jonathan Stark would call it.
John Logar is the master at this. Maybe it’s the friendly Australian accent, but he has a gift of getting people talking.
In my conversation with John, he broke down how he pre-sold $120k worth of software (that didn’t even exist yet!) starting with no list and no ideas — using only the Probing for Pain method.
Which of these business idea generating methods could you use?
Hopefully this post has your gears turning!
Let me know your favorite in the comments below.