Friday, 5 August 2016

How to know when to act on a business idea - Richard Branson

It’s easy to get caught up in the excitement of a new business idea, and feel sure that everyone else will love it as much as you do. But before you act to bring it to life, it’s important that you establish that there is a demand.


First off, here’s a test you can do right now: I call it the Mum Test. Pitch your idea to a loved one (I always try my mum first), who doesn’t necessarily know that much about business. How did they react? If your friends and family can’t summon enthusiasm for your idea, it’s unlikely that the average person on the street will feel any differently.

Entrepreneurs often tell me that they are scared to let other people know about their ideas, convinced that someone will steal them. This is a mistake. In reality, you’re far more likely to have issues with getting people on board with your idea, than stealing it. Even if someone was to use your idea, it’s highly unlikely they will execute it in the same way you will – no two entrepreneurs are the same.
How to know when to act on a business idea - Richard Branson
So get out there and bounce your idea off as many people as possible. Feedback from potential customers and your peers is invaluable when you’re proving your business idea. And if you bring your fellow entrepreneurs and potential customers along on the journey, they will be much more likely to support once you do turn your idea into a reality. I’d even go as far to say that someone stealing your idea is an excellent sign that you’re onto something great! Just don’t stand there and let them get away with it – do it better than them!

In fact, validating your idea through customers is becoming so popular that it has led to the spectacular rise of crowdfunding. I wish crowdfunding was around when I started out in business. Not only do you have solid proof that your idea is good – as people are putting their money where their mouth is, for a product or service that might not even exist yet – but you can also raise capital at the same time.

A great example of this is Virgin StartUp-funded innovation, the Barisieur – a beautifully-designed alarm clock that wakes you up in the morning with freshly-brewed coffee. After receiving £500 from Virgin StartUp to get started (another great sign of validation, by the way) they raised almost £400,000 on Kickstarter to start production of their invention. When I met the founder Josh Renouf, the Kickstarter campaign was drawing to a close, and I’ll be honest – I wasn’t sure how they were going to reach their ambitious target. They still had around £100,000 to raise, with just 48 hours left.

I thought it was a remarkable achievement regardless, but that’s nothing compared to how I felt upon learning that they didn’t just meet their target – they smashed it, with a last-minute crowdfunding sprint. Now, how’s that for demonstrating there’s demand for your business?!

In a way, I did my own version of crowdfunding back when we first came up with the idea for Virgin Atlantic. Decades ago, when my flight to the British Virgin Islands was cancelled because it was undersold, I hatched a plan. I hired a plane and put out a sign at the airport offering one-way tickets to the BVI for $39. I wasn’t planning on starting up an airline, but after I saw how quickly the plane filled up, I realised there might be a great business idea there. That moment of frustration, and the simple test it spurred, eventually led to Virgin Atlantic. Who knows what your idea could turn into…

Contact Form

Name

Email *

Message *