Take This Test To See If You Actually Have A Million-Dollar Idea


Photo: Peter Jackson via Flickr

I’m often approached by people who claim to have invented the next big thing, and ask me how much it’s worth, or complain that they can’t find an investor who will fund it. The honest answer is that ideas and new technologies are worth nothing, outside the context of a specific business plan that meets a market need for a fair price.Invention is the process of creating a new technology. Business innovation is taking that technology and successfully bringing it to market in a way people want. There is a variation on an old quote that sums it up for me: “Invention is turning money into technology. Business innovation is turning technology into money.”

Can you build a winning team?

What investors want is a proven entrepreneur, someone who can invent a product, find capital, and find a way of getting the product to market. It's better to have an average new product and a great team than the other way around. People are the most important element for success of a business.

2. Can it even be commercialized?

First you need to be able to manufacture and distribute the product in volume. Then you have to worry about politics, government regulations, and infrastructure. Hydrogen is a great fuel for cars, but who builds the network of service stations, upgrades vehicle engines, and implements safety regulations?

3. Can you sell it for five times the cost?

4. Is it competitive to the current alternatives?

What is your barrier to entry?

6. Is someone ahead of you?

Don't be afraid to ask people in the field if they've ever heard of anything along the lines of your idea. Do a patent search, but that doesn't cover patents in progress, or ones now being written (six month blind spot). Check published papers, scientific journals, and trade publications.

7. Are you sure you want to be first?

To read about some true million-dollar ideas, check out:

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