Editor’s note: This article was first published in September 2014; the stock market value of about 200 billion dollars it gives for Facebook is a figure from that year.
As you may have noticed by now, I like the American entrepreneurial mindset, because for an entrepreneur anything is possible. For many people, the very thought of having a business idea worth 1 million dollars or euros is practically unthinkable.
For American entrepreneurs, that’s small change. As Sean Parker told Mark Zuckerberg: a million isn’t cool; a billion is. Zuckerberg took that very seriously, and at today’s market capitalisation Facebook is already worth 200 billion dollars. And that’s much better than a billion.
So, to arrive at the million-dollar idea, you need to get inside the heads of the people who do it practically every month and copy their brilliance and their process.
See also: 15 million-dollar ideas that made them rich before they turned 20
We can divide the million-dollar idea process into 2.5 parts:
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- Arriving at the idea.
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- Turning it into a profitable business (this part needs no explanation).
- 2.5. Scaling up to the million (the hardest part).
1. Arriving at the idea
In Silicon Valley they use a process of synthesis and reduction. In the synthesis stage, a large number of business ideas are gathered. Most of them are about solving a problem, without considering how useful they really are, the cost of putting them into practice, the risks, the time it would take and many other factors. In fact, many of these ideas are completely crazy and absurd.
In the reduction stage, many of these ideas are eliminated. Some would never be a profitable business; others are practically impossible to carry out in a reasonable amount of time. Others simply raise more doubts than incentives. So ideas start being discarded over several rounds, until in the end only the ones that carry the most weight are left.
Sometimes ideas are discarded, and later on someone finds a way to turn them into a great business.
Jeff Nelson, an entrepreneur in the tech industry, gives the example of Google Labs, where thousands of ideas are discussed and only a few dozen make it to the final rounds. In the end, only 3 or 4 ideas turn out to be truly valuable because they find a profitable business model.
Combine concepts
If we look at everything that exists today, we might think that practically everything has already been invented. But people already had this feeling that innovation was impossible in the Middle Ages, and again in 1970, and again in 2000 with the dot-com boom.
And the truth is that there haven’t really been great innovations, but rather improvements to products that have led to other ideas, which are simply a union or combination of concepts from things that already exist, combined in a way that has never been done before.
Robotics, home automation, the Internet of Things, electric cars, alternative fuels, new forms of electricity, smart homes… it seems that everything on that list has already been invented, but the truth is that all those advances we enjoy are still in their infancy.
Do you know one of the most valuable patents in history?
Milk cartons. In the past (not so long ago), milk was sold in glass bottles, which were heavy and fragile. I imagine that if someone had come along with an idea to solve the problem of transporting and selling milk, somebody would have told them that the problem was already solved with glass bottles.
But an inventor realised he could keep milk in a container made of coated paper that was strong, light and not as fragile as glass. And that led to one of the most profitable patents in history, along with the mop and the stick used for ice lollies and lollipops.
But the million-dollar idea doesn’t always come from originality and innovation
In many cases, the businesses that succeeded weren’t the original project, but the solution to problems created by other million-dollar projects.
For example, all the data we give companies over the internet has given rise to the huge business of big data, while smartphones and connecting to the internet from them have allowed hundreds of entrepreneurs to create apps worth billions.
So all these new services and products, from the internet to innovation in your home, green technologies, the convergence of mobile and social, email, robotics… will create new problems and new business opportunities, as well as new needs. In other words, each of these innovative services will need new million-dollar ideas.
So it’s a matter of getting on board “the big thing”. And once we’ve had the big idea and we’re already on board the big thing, then we need to scale up to the million, and for that we’ll continue in a second part with some tips worth following.
Further reading
- Validate a business idea in 5 minutes with a pen and a napkin
- 15 questions to evaluate a business idea
- 32 rules for becoming a successful entrepreneur
Featured image: Tetra Pak, CC BY-SA 2.0, via Flickr.
