3 Strategies To Help You Choose The Right Business Idea To Pursue

3 Strategies To Help You Choose The Right Business Idea To Pursue

I’m not sure about you, but I’ve got about 50+ domains for “projects” that have never gone anywhere.

What most people don’t know is when I started working on Clarity, I also has 2 other projects I was pursuing.

Photovino – Take a picture of wine and 2 bottles will show up in 2 days
SecretSender – Simple way to send private information

Even though both were great ideas and solutions I used… they weren’t the right project to grow into a business (for me).

The tough part is always picking the right idea, project or business in life.

That’s what I want to share with you in today’s video… some strategies for picking the RIGHT idea.

At a high level, it comes down to these 3 things… but not for the reasons you think.

You’ll really need to watch the video to get the gist.

But here they are:

1) Trends
2) Domain Expertise
3) Passion (again, not the way you’re thinking about it)

To me, these “filters” have helped me pick the best ideas that turned into the biggest companies.

I’ve started 5 companies in my career and the last three I used this filter, hence why they were such huge successes (and acquired): Clarity, Flowtown, and Spheric vs. the ones I didn’t and they failed miserably: MaritimeVacation & NBHost.

Now, a favour…

What I’d love to hear from you is how many projects you’ve started? How many went nowheres? I’d LOVE to hear from you so I know I’m not the only one :)… leave a comment with your answer below.

Have an amazing day!

Dan

  • http://www.crowdfundinghacks.com/askclay Clay Hebert

    I’ve started about 6 real projects (not counting childhood lemonade stands, etc.). Two successes. Four failures. And probably 50+ microfailures…. ideas -> domain names -> didn’t proceed for a number of reasons.

    • http://twitter.com/danmartell Dan Martell

      Clay, appreciate the honesty.

      I’ve started 5 companies, probably 20+ projects (full domains, coded projects, launched, users) that didn’t go anywhere and 50+ domains for other ideas that may never see the light of day 🙂

      I remember asking Hiten Shah this question… his numbers (I believe) were higher than mine :).

      Guess were all in good company.

      DM

  • prosequence

    16 ideas/concepts, 12 starts, 8 with significant time/$ into them. 2 became “paying hobbies”, 1 went into receivership, and the others are active with moderate success. Currently pursuing political career, if unsuccessful, then I will be adding another venture. It’s been quite an entrepreneurial roller coaster 😉

    • http://twitter.com/danmartell Dan Martell

      Appreciate the comment and share!

      DM

  • Philip Sweezey

    I can’t say for certain how many projects I’ve started, as I have worked in the education system for almost a decade, and most of my projects have been solutions to disengagement. That being said, I’ve started one business last year, and have one client I am working with currently. However, I’ve been pulled away / distracted / motivated to pursue a new project to build a program specifically targeting entrepreneurship education in New Brunswick high schools. Some of the ideas and skills that are a part of my own project have served me well so far.

    • http://twitter.com/danmartell Dan Martell

      Philip, cool… hope to see one of your ideas become a big meaningful business some day (if that’s your goal). The region needs more entrepreneurs creating big businesses to shine a spotlight on so that it’ll inspire other entrepreneurs around.

      Hope that’s you someday!

      DM

  • http://www.shift8creative.com tom_m

    I’ve started a bunch of projects over the years. I’m not sure they were ever “failures” because they were all learning exercises at the same time. I like to roll things forward with me if that makes sense. For example, if I build out an MVP, I take parts of it to the next project.

    The thing is, I just haven’t “started” any (businesses) really. Trying to find the right people for a team, trying to secure funding or time (I’m not a huge fan of VC). I’ve validated. I’ve got hundreds of people’s interest and newsletter sign ups and such…But it’s tough when you have children. You need the stability.

    So what I’m starting to do now is what I like to call “catch and release.” I just build things in my spare time and open-source them (this can be massively disruptive too). I take the pressure off me with regard to timelines and business. It doesn’t matter if the projects make $0…But keep in mind that there’s the potential for open-source to make money. So for me, this has been an incredibly useful way to vet my ideas and enjoy building.

    When you remove the fear that most people have with their projects and an NDA isn’t a barrier and showing someone your code isn’t a barrier… Something awesome starts to happen. You end up in a strong position.

    When I meet other entrepreneurs, some of them are always so cautious. Full of anxiety. They don’t want to spill all the details…Always the fear someone will steal the idea (that’s already been done by the way). The reality is, I could build their idea quite easily. I’m a full stack developer and if I wanted I could completely re-build just about anything you can find on the internet. The thing is, that’s not all there is to a business =)

    So I think the only ideas that are truly failed ideas are those that aren’t shared with others.

    • http://twitter.com/danmartell Dan Martell

      Tom, I like your thinking … however, when it comes to the definition of “business” then it’s about creating value and making profits. That’s a business.

      Projects… that a different thing and that’s why their called “open source projects”.. they’re creations for everyone to enjoy.

      Again, I like your thinking … everything is an opportunity to learn and grow, but if you’re goal is to create a business then it needs to be measured by normal business metrics and failure = failure to make the economics work long term.

      my2cents.

      DM

      • http://www.shift8creative.com tom_m

        Of course and I agree. To be more clear, I think just because a business may fail it doesn’t mean the idea (or project even) is a failure.

        I also think there’s so many people out there trying to “hide” their ideas and projects too. This sense of fear or hesitation. You speak about it all the time with regard to business building. Just get out there and do it.

        I think similarly and aside from business or, perhaps, before the business the same can be said about the ideas and project. Any business is a project before it is a business of course and it’s so very important to get that project idea out there. In fact, had many spoke about their ideas freely and often, they may have saved themselves from a later failed business. We often skip this process which includes idea validation.

        As always, thanks for sharing this and your insight.

  • Nawar

    I’ve started four projects, all failures, and now, I’m in the fifth one which I am trying to turn around. However, I learned and grew wiser from each and every one of them.
    All of them where ideas turned to prototypes and fully functioning platforms with lack of validation/users/funding/proper marketing.

    • http://twitter.com/danmartell Dan Martell

      Nawar, really appreciate you sharing.

      What would you do differently going forward?

      DM

      • Nawar

        IMHO, I’d work harder to raise a seed round before doing anything which can give me enough runway (and pressure) to experiment with a prototype, drive traffic to it, validate the idea and keep iterating until MKT fit is achieved.
        N.

  • http://www.about.me./Mariah.Lichtenstern Mariah Lichtenstern

    My projects have mostly been related to my passion, so I’ve not started that many. My first venture was a boutique production company which allowed me greater freedom and experience in preparation for grad school in motion picture producing. That eventually evolved into a media consulting and project development company. In between, I attempted a non-profit in the same space (media/ filmmaking), which thankfully didn’t work out. I also had a private financial planning practice, which I got out of before the market collapsed. I entered because I knew it would advance my understanding of the securities laws that applied to film finance, and I figured it would help me pay for graduate school while helping families and small businesses.

    Afterwards, I considered a few projects, decided against them before inception, and then launched a short-lived, cross-platform, mobile app development company. It was probably slightly before its time and could not keep my interest by itself. All other projects have been just that – projects – which I could complete and / or move on from. There have been failures there…like the reality show I spent a year developing only to have the talent move away and pull out while sale was impending. I liked those in which I was paid to develop skills that would be ultimately applicable to my current company, which I’ve waited many years to see the stars (regulatory, technical, and social) align for.

    There you have it 😉

    • http://twitter.com/danmartell Dan Martell

      Mariah,

      Wow… REALLY appreciate the back story.

      I’m sure others will resonate with that approach.

      When you dig deep, we realize we’ve all gone through similar challenges.

      Thank you.

      DM

  • http://www.lettuceclean.com Glenn2001

    I have registered about 10 domains a year the past few years. Most projects never got going as I kept my day jobs. Three years ago I left a fin-tech consulting partnership I co-founded (a success) to go all in on an idea that seemed to pass your filters, but in hindsight, we did not have #2.

    This summer we wound down our messaging app for families http://www.messagepetz.com (a failure). My co-founder and I saw ourselves as a tech company. The market saw us as a toy co. We did not have that industry skill set on our team which made raising VC hard. This caused us to miss the window initially presented by Filter #1.

    While mourning by going fishing, I had another idea. I started KindFishing.com based on Filter #3 (animal rights/sustainability/environmental issues) and strong positives from Filters #1 (growing global environmental concerns) and #2 (grew up fishing). During my product/market fit work I saw that the market would need to be educated. I did not want to again go through being the first to market with a problem people didn’t know they needed solved (an avoided failure)

    Needing an income, my wife said (and she meant it) “you’re going to clean houses if you have to”. So I recently started LettuceClean.com. It solidly hits all three filters for me. I have registered a few other domains so I can own “It’s like Lettuce for…” (sorry Uber) as we grow.

    • http://twitter.com/danmartell Dan Martell

      Just as an FYI, a great way to generate an income and stay in the market to build the product is consulting.

      We did that at Flowtown … closed 15 customers to fund our R&D on the product testing. Here’s a video on our process & lessons learned.

      https://www.youtube.com/watch?v=aLgaFR3ZxxQ

      P.S. Was also one of the first talks I ever gave… so bad, but learned a lot 🙂

      DM

      • http://www.trijetset.com/ James Balcer

        Great video. One of my favorite parts is 11:00. From day one… It’s a profound realization that you’re supposed to fail. Make you grow, makes you stretch, makes you hone in on the best ways to move forward and have positive experiences and multiple successes as your reach for your goals. Thanks for sharing this video.

  • Shrikant

    I did 2 companies. 1 failed, (domain, product, users..) 1 exit. On my 3rd company (domain, product users) lot ahead compared to my last company, but still much further to go before hanging the NAILED IT! banner. Appreciate the filters, reconfirms what I learned and, yes good to know we are in good company with my 30+ domains/ideas. Not crazy per Entrepreneur’s definition.

    • http://twitter.com/danmartell Dan Martell

      Shrikant,

      Entrepreneurs by definition are crazy, but amongst our peers we are sane .. that’s why I like hanging out with other entrepreneurs, they make me feel normal 🙂

      Appreciate the comment.

      DM

  • Robert Armstrong

    4 legit projects / businesses…..5 or so other projects (some semi-successes and some semi-failures)

    • http://twitter.com/danmartell Dan Martell

      Robert, that’s awesome … sounds like you’re my type of guy… a creator always looking to solve problems in the world.

      Nice!

      DM

  • http://www.NickEubanks.com/ Nick Eubanks

    Such a good question, and one I know all too well. I have somewhere in the neighborhood of 300 or so domains, most of which were purchased for projects, joint ventures, or just ideas.

    I’ve launched probably 20 of these “projects,” 4 or so that are still going (mixture of blogs, content sites, and lead gen), a handful that sold (but nothing I would ever consider to be really successful), and the vast majority of which got build, coded, *launched*, and then ran out of steam.. good example of this is my now defunct Friday newsletter NicksLinks.net that I got up to ~2000 subscribers before letting it just fizzle out and die on the vine.

    Of all of these, even the minor successes, none really had all 3 filters. My current ecommerce site + agency have a healthy mix of the 3, but a bigger part of me feels I would be building faster if I was able to just focus on one thing.

    Oh look, something shiny.

    • http://twitter.com/danmartell Dan Martell

      HOLLY SHIT! 300 domains … you win, hands down… super impressive.

      Sounds like you love creating… love that and honestly, your shits great (from what I’ve seen) so keep it up, the world needs more of that.

      Appreciate the comment!

      DM

    • http://bradmills.tumblr.com Brad Mills

      I can relate with oh look something shiny 🙂

  • http://knollcoaching.com thomasknoll

    Most of my projects can be defined as, ‘trying to get other people to build what I want.’

    • http://twitter.com/danmartell Dan Martell

      🙂

  • Dennis Michael

    I have about 20 domains right now. In the past I had 3 or 4 projects that I was working on but they lead to nowhere because I couldn’t articulate them well. The validation phase was a big mess of confusion. I still want to go back to them eventually because I still feel there is a gem sitting there, but I need to get a few partners to make them flourish. Right now I have 2 domains which I am very proud of and want to build into something greater – VenueJar.com and WakeCreative.ca . My partners in VenueJar are amazing and I know that we are going down the right path with this business. Wake Creative has become my creative outlet and a resource for VJ which will do amazing things for myself as well.

    Dan, love your videos and love the guidance you are giving Amin for VJ. I want to take you out for a beer when we meet. Cheers!

    • http://twitter.com/danmartell Dan Martell

      Dennis,

      Amin is world class.

      Great listener and takes action.

      Honoured to have him part of our group.

      DM

  • http://hacking-shindyapin.tumblr.com ph0rque

    I’ve been working on my project (http://automicrofarm.com) for five years now. It’s my latest in about half-a-dozen projects, but this one is different. It’s beyond passion: it has a hold on me like no other project ever has. This is what I wrote in a recent blog post (http://blog.automicrofarm.com/post/125586438426/tomorrowland-ambitious-bootstrapping-and):

    “Truth be told, I’ve given up on the AutoMicroFarm idea dozens of times.
    It’s crazy to think that one guy can create a simple, easy, and
    automated micro-farm for every backyard—something that hasn’t been done
    by anyone (yet). But the idea pulled me back to work on it, time and
    time again. At particularly depressing times, I wished someone would put
    me out of my misery and release a similar product already. Alas, no-one
    has done so, or seems to be doing it, at least not how I have
    envisioned the product… I feel I’m compelled to
    make this particular bit of the future a reality.”

    • http://bradmills.tumblr.com Brad Mills

      Subscribed.

      follow Clay (posted below) for Kickstarter tips – you should launch a crowdfunding campaign

    • http://twitter.com/danmartell Dan Martell

      The reason we build solutions to the worlds problems is because we haven’t found someone solving it the way we feel it should be … doesn’t mean there isn’t competition, but they’ve taken a different approach.

      To me that’s a great reason to build a business.

      DM

  • http://bradmills.tumblr.com Brad Mills

    Since 2006, purchased well over 300 domains, I actually bought one last night for a new project 🙂

    The hardest thing for me is hustling so long and seeing some very close people have mega exits. I.E.
    -spent 100k personally on FB game that was more like an incubator for 3 local guys from my home town I hired. When we ran out of money, they got together and started a company that sold for 70 million a year later. Still friends, love those guys, but that one hurt for a while.)

    ~20 failed projects before we flipped our first facebook app in 2008, bought it for $500 sold to National Lampoon for $30k

    Projects – too many to count, about 100 with a developed website or product:

    Projects that succeeded (over 20k/mth):
    -Elite Bio Labs (current)
    -Nuvia (healthy coffee, current)
    -Facebook Games (slowly dying for 5 yrs, was in final stages of $2m acquisition when stock market took a hit)
    -iPhone Games (current, not growing)

    Projects that failed:
    -generating and selling MLM leads (sold to Cory Schop)
    -sleep aid spray on Amazon
    -homeopathic feminine napkins
    -~30 facebook applications
    -fat burner supplement on Amazon
    -~245 Ios games (raised over 1 million for this)
    -feature length horror movie (but was a huge creative success)
    -private label weight loss company
    -CoinWhale, groupon for FB games (Noah Kagan was part of this one with me)
    -lost 200k on a bitcoin mining operation where a partner screwed us over.
    -bitcoin trading project … lost 150 bitcoins in MTGOX when it went down
    -10 random other bitcoin projects / sites.
    -~200 blog content farm for SEO and Adsense revenue stream.
    -social media consulting
    -brokering affiliate and pay per call leads
    -a couple other technology projects.

    Anyone have a good referral for an entrepreneur psychologist 🙂 (kinda serious)

    • http://twitter.com/danmartell Dan Martell

      Brad,

      Something tells me that you don’t play nice with others… doesn’t mean your an a-hole.. just means you probably have some challenges collaborating and involving others in your success.

      That’s the missing piece to build a great company … sure it requires a founder(s) but more than that, it requires someone who can inspire, recruit and lead big teams to build.

      my2cents.

      DM

      • http://bradmills.tumblr.com Brad Mills

        Challenges collaborating – probably true. Challenges involving others in my success, could be an element of truth there.

        I’m a big “handshake” guy and even bigger on loyalty. I can inspire people to follow me, but I struggle with management and when I feel like someone is being disloyal it really shuts me down.

        I think my bigger issue is that I always seem to burn out my developers and the relationship turns tense because I’m expecting too much of them.

        I do try to prioritize the goals and dreams of my employees/contractors and give profit share / equity.

        In my last company I wrote everyone’s dreams on the wall to constantly remind me what my team wanted to achieve.

        I structured my last company around Dan Pinks philosophy of providing an environment of mastery, autonomy and purpose.

        • http://bradmills.tumblr.com Brad Mills

          Dan do you think loyalty is important from employees/partners?

          Or is that an insecurity or trust issue on my part?

          I.E. Employees working on other projects while working for you full time?

          • http://twitter.com/danmartell Dan Martell

            Brad,

            Maybe it’s having a mix of contractors & employees… to me, employees shouldn’t have side businesses… passions, hobbies, open source projects, etc – no prob.

            If people want to run there thing on the side, or keep some clients – then just do contracting.

            Truth is, you’re the entrepreneur.. they aren’t – realize that they’ll never be as committed as you are and that’s why you’ll be known as the creator and they were just on the team.

            Big difference, and I’m totally o.k. with that.

            DM

  • Cedric Tapiwa Rusike

    As embarrassing as it is to say I have initiated 16 projects in the last 10 years as an “entrepreneur”. 4 Had to be put to rest because of mismanagement or not paying attention to financial side of things as much as I should have. Sometime when business is presumably healthy, I tend to loose sight on the financials and just focus on sales sales sales. 2 projects are currently dormant, 1 I sold to my sibling, so now she owns 100% of that and is doing very well. 5 are still in the idea phase and may never materialize. 3 are in full operation and they keep me very busy. 1 that I am super proud of and is greatest achievement thus far is doing considerably well and has surpassed my expectations.
    All to say I started my 1st real business project at age 17, and 10 years later I still feel like I have a lot to learn and so much to achieve. Thanks to blogs like these and interacting with other Entrepreneurs via mastermind groups, chambers of commerce, meetups, YouTube , periscope etc…; I have cut my learning curve and hope to continue doing that. Going forward and lessons I have learnt from these experiences is , I can not do everything. I have to focus on what I am really good at and get a partner or hire someone else for some tasks. I have also learnt that not every business idea is a good fit for me and its okay to pass up on an opportunity. Dan’s stance on the fear of missing out really resonates with me and I am slowly passing on projects that may come my way and I am not really excited about.

    • http://twitter.com/danmartell Dan Martell

      Cedric,

      Thanks for the honest answer and for the kind words.

      FOMO is a real thing and hurts a lot of entrepreneurs who otherwise would create great companies if they could only stay focused and push forward.

      Having a team IS A MUST.

      If you focus on that aspect, I think everything else will take care of itself.

      Hope that helps.

      DM

  • http://valisemag.com Valerie

    I’m definitely a project “addict,” and I get really frustrated with myself for not actually making them all happen. Do you ever have that difficulty? Maybe it would help to sit down and put them all in a chart to determine which ones are “okay” to let go. I’d love to hear your thoughts on this!

    • http://twitter.com/danmartell Dan Martell

      Valerie,

      It’s o.k. to start projects, but what’s important is also being someone who pushes forward and puts all your energy and passion behind the one or two that will leave the biggest impact in the world.

      Putting ideas in a chat isn’t the way you can determine the right project for you … it’s a very personal thing.

      You know it in your gut …. but once you realize that, then it’s all about making a decision, removing distractions and going ALL IN.

      If you have a hard time with that, it’s probably other aspects of your belief systems that you’ll need to look at and improve… likely has nothing to do with the quality of the projects.

      my 2 cents.

      DM

      • http://valisemag.com Valerie

        Dan, thanks much! I think we might have gotten confused — I thought about putting all my ideas in a chart (not chat) and comparing them. That’s probably getting way to type A though 🙂

        You’re right though — it would help to tune into my gut a bit more before launching things out there!

  • http://www.matthewmarcus.com/ Matthew W. Marcus

    What a great topic, Dan. Especially for me personally right now. My team and I started https://1minutecandidate.co about 3 months ago, and we’re still working to find product / market fit. Looks like it’s time for us to determine if this is the “right” idea to pursue. It might not be part of a trending market right now, but the whole political game and voting system is definitely ripe for disruption (buzzword alert!) no matter what angle you look at it. SOMEONE has got to help fix it, if only for the fastest growing generation in America: the millennials!

    Re: my previous ideas, the one’s that resulted in actual projects are: http://kula.com, http://playulty.com, http://ultitalk.com, http://localruckus.com, http://hoopla.io, http://kcsv.org, http://kcstartupfoundation.org and now 1 Minute Candidate. Some linger, some are dead, some are new.

    The ideas which I’ve heavily researched but haven’t yet started are connected to the UAV (drone), crypto currency and gigabit network industries. Fascinating stuff!

    Re: your three filters: the one which I think should be taken the lightest by entrepreneurs is having previous domain experience. There are so many examples of entrepreneurs that had zero previous experience of even in-depth understanding of an industry in which they created viable and successful startups. In fact, sometimes that’s exactly what it takes! Someone with fresh ideas, who can see the industry from a new perspective, and hasn’t been blinded by traditional views and concepts.

    As always, thanks for the wise words Dan!

    • http://twitter.com/danmartell Dan Martell

      Matthew,

      Maybe I shouldn’t of use previous domain experience … but more “unfair advantage”. That’s likely more accurate of a filter.

      All great founders had that … either connection, knowledge or access to a special distribution outlet to help the company get to escape velocity.

      As for your projects … it’s great to have impact in the world, but the business model needs to be there and that means revenues and profit.

      How much time to you spend on that aspect of the business / validating / growing vs. just building the product or service?

      Might be worth looking at to take things to the next level for you.

      DM

  • Eric Buining

    Hi Dan,
    Thanks again for a very good video message.
    I do follow these three filters and have realized that I am good at certain
    stuff and less good at other stuff. The experience and domain expertise
    one does not need to have as long as you are working with a team in
    which that expertise is available.
    However, I just wanted to let you know, and you briefly mentioned in one
    reply that a good project consist of a good innovative product or service
    and a good innovative business model.
    Contrary to common belieft is the importance of a proper business model.
    I think it is an under-rated element within startups.
    We all do MVP’s, but are missing the minimal viable business model or
    MVB.