CHAPTER 1
Coming up with an idea
To get started, the first thing you need is an idea. They are free to come by; the secret is in the execution!
Ideas can come as a lightbulb or eureka moment but, for most people, it is a case of realising that what you really want from life is to pursue an interest, and make a living from doing what you most enjoy. In terms of coming up with the idea, my advice is to ask yourself these three questions:
- Have you spotted a gap in the market? Have you tried to buy something that you just cannot find? If so, others might be looking for that product or service, too.
- What is your passion, hobby or skill? There is no finer way to start a business than basing it on something that takes your interest, as the working hours will not seem quite so long!
- Have you seen someone do something that you think can be improved on? If so, it could be time to give it a go.
The answers to these questions will help you shape an idea, which can then be tested.
I run a monthly event called StartUp Saturday where, in the space of five hours (on a Saturday), we cover all you need to know to start a business. At the beginning of the day, I ask StartUp Saturday-ers to share their business idea with the group. It is at this point that many ask if they should be sharing their idea at such an early and delicate stage, for fear of someone else stealing it!
My view on this is clear: unless you have come up with a unique invention that needs protection and patents (see the section on ‘intellectual property’ in Chapter 4), then you are pretty safe in telling a trusted circle about your idea. Someone else would find it hard to develop the idea in the way you envisage. One of the great assets start-ups have is the power of the story that comes with the idea and you, as the business owner, are a big part of that story – this is something no-one can take away from you.
A start-up I know and love is Claudi&Fin. Started by friends Lucy Woodhouse and Meriel Kehoe, these two ladies launched a business selling Greek-style yoghurt lollies for kids. Their first customer was Sainsbury’s, where they are now stocked in over 400 stores. I asked Lucy if Sainsbury’s was comfortable dealing with two mums running a business from home when their usual suppliers are huge multinationals. ‘The fact we are two mums running a business around the kids is what makes us special and stand out,’ was the reply.
The point is, any large company could decide to go into production of frozen Greek-style yoghurt lollies but, what they cannot replicate, is the authenticity and story of the people behind it.
With safety in sharing assured, it’s time to test your idea on what I call the Friends and Family Focus Group.
Friends and Family Focus Group
Turn to those you trust to seek their views. Some say you do not get honest feedback from friends and family and, certainly, you will need to speak to potential customers, too. This is covered in the next chapter devoted to market research but, first, ask those you know the following questions:
- Do you like the product/service?
- Would you buy it?
- What would you pay for it?
- Does it suit my skills to run this business?
The result of this focus group could be changes to your product or service as well as having an opportunity to perfect your pitch.
You want to get to a point of describing the idea as articulately as possible for those ‘elevator pitch’ moments when you have less than a minute to make your mark with potential customers/suppliers/funders/buyers. To achieve this, try a simple exercise of describing your idea in the form of a tweet. This means you have less than 140 characters to get the message across! For example, for Enterprise Nation, it would be:
We help people start and grow their own business, through a daily blog, live events, books and kits, and a campaigning voice to government.
What would yours be?
Niche is best
When coming up with your idea, try to make it as niche as possible. What I mean by this is, be very clear on what you offer and to whom.
The benefits of starting a niche business are two-fold:
- Low marketing costs – as you know where your customers are, their likes and dislikes, what they are reading/watching/listening and their key influencers.
- High customer loyalty – as customers can get what they are after only from you.
Alison Edgar is a good example of the benefits of a niche business.
Case Study
Name: Alison Edgar
Business: Sales Coaching Solutions
For Alison:
When she started her sales coaching business, the plan was to offer all types of sales services to all types of client. Alison soon realised this presented a marketing challenge as she had to run promotions everywhere to reach such a wide market. Her other love in life is small business (as she is one!) so she decided to niche the business and become a sales coach, focused on the small business sector. This immediately refined the marketing plan as Alison only needed to appeal to small businesses so she delivered guest posts on small business blogs, approached small business editors in the press and got involved with government programmes that support small business! What’s more, she could introduce her clients to each other.
- Marketing costs were minimal – as she knew exactly where to find her clients and the kind of messages to which they responded.
- Customer loyalty was high – as not only did Alison deliver the sales coaching promised, she also delivered industry expertise and introductions, i.e. extra value to every client.
When I first set up I didn’t think I needed a niche as I considered the skills I had were so transferable that I could support anyone in any business sector. Then I came on to marketing my business and I didn’t know where to start. After deciding on my niche market everything fell into place. I have a focus to my business and a focus which I happen to love.
Eveline Ip is another business owner benefiting from the power of niche, as she develops her app directing dog owners to dog-friendly venues.
Case Study
Name: Eveline Ip
Business: Doggity
The idea for Doggity came about in the summer of 2012. I was working as a business analyst for a major outdoor advertising company in London. My husband and I became dog owners and struggled to find dog-friendly venues. There were a handful of websites and forums that included bits and pieces of information, highlighting pubs to hotels and beaches. We saw a gap in the market to pull this information together with a focus on dining venues in urban areas of Britain.
Eveline found a developer and offered him a 10 per cent share in the business in exchange for a discounted cost for developing Doggity’s website and app, and it took three months from the initial idea to having a rough and ready version available on iTunes.
Our market is dog owners in urban areas so we can be selective and reach out to journalists in lifestyle sections of broadsheets and magazines to market the product. Our biggest PR success to date was being included as a top 10 pet-friendly gadget by The Independent. A surge in downloads followed!
Eveline keeps the app updated by keeping an eye on new eateries and venues and contacts them to ask after their dog-friendly policy, with an annual audit to ensure the data is up to date and accurate.
Over the next 12 months the plan is to focus on growing the number of venues, increase the number of downloads and monetise the app.
I heard at an Enterprise Nation seminar the advice that niche is good and that stayed with me. As technology continues to advance, many generalist apps have become redundant. Smaller niches, on the other hand, continue to grow. I’m a big believer that niche is good!
@doggityUK
See Chapter 7 for ways to market your idea to a chosen audience, without breaking the bank.
The name game
With an idea in place, it is time to come up with a name and this could just be one of the most time-consuming tasks of your start-up!
When thinking of a name, consider the following:
- Have you got a name that could lend itself to a business? US entrepreneur Martha Stewart has done a fine job of building a multi-billion-dollar business, using her own name.
- Choose something that is easy to spell and translates well across borders if you are looking to go global.
- Check if the name is available by doing an online search, checking domain name and social media availability and using Companies House WebCHeck service at http://wck2.companieshouse.gov.uk/.
The name does not have to describe what you do; does McDonald’s describe burgers or Apple shout computers? But do think of a name that will sit well with the market you are going to serve.
Top tip 
Most domain registration websites offer alternative name suggestions when searching for domain availability, which can offer inspiration.
- GoDaddy: www.godaddy.com
- 123-reg: www.123-reg.co.uk
- 1&1: www.1and1.co.uk
See Chapter 4 for advice on how to protect your name, company brand and the business idea through intellectual property protection.
Investing in an idea
If you really want to start a business but just cannot think of an idea, consider buying into someone else’s! This is where direct selling comes up as an opportunity. For less than £100, you can become a consultant, agent or network marketer with some household brands. The benefit of buying into a direct selling opportunity is you are your own boss, with the support of a team of fellow agents on hand. Here are five of the better-known opportunities and the costs of starting in business with their brand.
| Brand and product | Cost |
| Avon Independent Avon representatives sell beauty products via print catalogues and online in their local area. www.avon.uk.com |
Nothing to pay up front. The start-up fee of £16 is charged to your account after you have placed a first order – this is split into £10 in your first order and £6 in the second order, i.e. you pay the fee after making sales. |
| Betterware Home supplies are on offer from this company that has been trading for 85 years. www.betterware.co.uk |
No start-up fee and you receive promotional materials and catalogues to start trading, for free. |
| The Body Shop At Home Sell gifts, make-up and skincare at home parties or online with a brand that is well-known on the high street. www.thebodyshop.co.uk/athome |
Consultants are asked to buy a Pamper Kit, which costs £45 and contains £175 worth of products and catalogues so sales can start. |
| Jamie at Home A party-plan business selling the Jme collection of kitchenware. www.jamieathome.com |
There are two starter options:
|
| Scentsy Home parties selling perfumes and scented products. www.scentsy.com |
The starter kit costs $99 and comes with products, catalogues and a personal website so you can launch straight into hosting your first party. |
With any of these opportunities, carry out plenty of research before handing over money. Speak to existing consultants and agents to ask if they are earning, and visit online forums to review comments as well as checking if the company is a member of the industry body, Direct Selling Association (www.dsa.org.uk).
Total cost of coming up with an idea:
| Idea generation | £0.00 |
| Friends and Family Focus Group | £0.00 |
| Coming up with a name | £0.00 |