
The single biggest hurdle that most entrepreneurs face is coming up with the right business idea.
Where do you start?
How do you build a consistent stream of business ideas?
How do you know those ideas will work?
This is a guide to becoming a business idea generation machine. Youâll learn how to think like an entrepreneur, solve problems critically, evaluate business ideas and take action while the iron is hot.
Let's get started with the guide on how to generate new business ideas.
Change Your Mindset
// If you read nothing else, read this.
Coming up with ideas for businesses is not difficult.
Most people view it as the hurdle that stops them from starting their own business. Itâs not.
I have a theory about why this is the case: Most people think that if you have an idea, it must be a million dollar idea.
The thought process looks something a little like this:
I want to become an entrepreneur. I want to start my own business.
Starting a business requires a good idea. If only I could think of an idea for a big business like Facebook or Airbnb. Thatâs what real entrepreneurship looks like.
Iâm just a first time founder, what do I know about starting a million/billion dollar business?
Thereâs no ways Iâm capable of coming up with a million dollar idea.
Iâm not good at business ideas, and I wonât be able to start a business without one.
Sound familiar?
Know this: ideas are easy. Theyâre easy, because not all of them are going to work.
An idea does not equal a business. The hard part is executing on the idea.
All ideas are good ideas because thatâs all they areâââideas. Accept them from wherever they come.
Be confident in your ability to generate new business ideas, and confident in your ability to critique them. By allowing yourself to dream and think freely, your mind will explore opportunities it never knew were there.
Getting into that way of thinking is going to make the rest of this guideâââwhere we go into how to generate new business ideasâââmuch more fruitful.
New Business Idea Basics
// If youâve got a good idea about what makes a good business and the different models that are good for scalability etc. then skip to the next section. If youâre a first time entrepreneur, read this section.
Every great business was built using these four ingredients (they might have had a bunch of other extraâs, or an imbalance of these ingredients. But if they were a success, they had these 4):
- A problem. [Problem]
- The right solution to that problem. [Solution]
- A way to get that solution to the people with the problem. [Distribution]
- A way to get paid for solving that problem for those people. [Monetization]
Working backwards from that⌠those are the four ingredients every business idea should have.
So, by reverse-engineering the ingredients of a great business, we know where to start in the business idea creation phase: Problems.
Thatâs where weâre going now.
#1: Problem First
Becoming a problem-solver is the first step to creating business ideas.
You have to want to solve problems.
Itâs an easy to thing to say. Not easy to do in practice.
Here are a few ways to find problems you can solve:
Look in your inner circle
The biggest mistake a lot of early entrepreneurs make is they reach too far out of their area of interest/experience.
If youâre a person who loves sports, tackle a problem that involves football or athletics. Start a company like Barstool Sports. It would be a waste of time and resources to try and solve a problem that middle-aged women who like to garden have. Itâs just outside of your realm of knowledge.
Solve a problem youâre familiar with, basically.
Be a painkiller, not a vitamin
The difference between them? A painkiller is something most people absolutely need. Got a headache? You take medicine to fix it.
However, vitamins are nice-to-haves. For that reason, people often forget to take them. They donât absolutely need them.
Build a product that solves a pressing need, not a want.
Looking for examples of needs vs wants? Maslowâs hierarchy of needs explains how peopleâs decisions are influenced, based on a hierarchy of human needs.

Experiences
This one needs no explanation: New experiences means your eyes are opened up to the wonderful world of opportunity.
No experience is bad experience. If in doubt, do it.
Look at failure as being one step closer to finding the right business idea.
A job
An unpopular opinion, but one that needs to be chucked in here.
Jobs arenât the sexy option. Very few people who want to start their own business want to work for someone else. Itâs just not appealing.
Donât discount the value in it. There is so much to be learned from other peopleâs journey of building a business.
One of my great early learning curves was joining a ârocketâ. An early-stage tech company where I was employee #4 and was made the âget it done guyâ who doesnât have an official role. I headed up projects and teams, took on responsibility, and mucked into just about everything I could.
Itâs like starting your own company, without the risk. You get to observe all the mistakesâââand learn.
#2: Building an Idea(l)Â Environment
This is one of the most important things I did which completely changed my perspective on the startup world, and starting my own business.
The first company I started was a complete fluke. I started with a product first and worked my back from there. It just so happened there were other people who wanted the productâââthankfully.
Going through that process helped me realize how valuable a community of entrepreneurs is to your journey. And more importantly, what they do to your mindset.
Thereâs a reason San Francisco produces successful tech startups like no other place in the USâââyou go there to build. You become part of a community that is driven towards success.
Thatâs what you need to carve yourself out.
Social media can help you do that. Twitter is my drink of choice here. You can literally build your own auditorium of speakers.
Here are some of the best people I follow:
- HackerNewsâââYCom
- Sid JarthaâââFounder of Gumroad
- Jack ButcherâââFounder of Visualize Value
- Anne-Laure le CunffâââFounder of Ness Labs. An articulate thinker.
- Andrew WilkinsonâââCo-founder of Tiny Capital
- Gagan BiyaniâââFounder of Udemy
- Adam GrantâââAuthor of a few good books
- Nathan BarryâââFounder of ConvertKit
- Sam ParrâââNot necessarily fantastic on Twitter, but a super-fast mover. A lot to be learned from the way he operates.
Itâs like listening to the best founders, entrepreneurs and thinkers in the world giving free advice, on tap.
Another great resource is newsletters. Here are 4 valuable oneâs I follow :
- Scott Gallowayâs No Mercy, No Malice.
- Seth Godinâs Daily Blog.
- James Clearâs 3â2â1 Thursday.
- All the Andreesen Horowitz Newsletters.
Theyâre not always necessarily business related, but these are some of the most original thinkers I know of. And this is what youâre doingâââchanging the way you think
To get your creative juices flowing, here are three other sources of ideaâs/trends that I check in on every now and then:
Youâve probably heard the saying, âYou are the average of the five people you spend the most time withâ. To some extent, I agree with that.
By surrounding yourself with the voices and thoughts of the worldâs best founders, youâre getting a feeling for the way they operate.
And youâre getting a feeling for what it takes to become a successful entrepreneur.
Youâre shifting your mindset.
#3: You Donât Need to Reinvent the Wheel
One of the easiest ways to know youâve got a good business idea, is to piggy-back off the back of an already successful one.
That is whatâs happened to Craigslist.

Whatâs happened here? Well, entrepreneurs have realized the success of Craigslist: people do like having a place to go and look for goods and services (a marketplace).
And theyâve made the experience better.
Zip Recruiter replaced the job section.
Airbnb replaced B&B and guest house ads.
Tinder replaced the dating/people section.
Thumbtack replaced the services section.
The list goes on.
What makes these marketplaces better than Craigslist itself? Theyâve made the customer experience better. In doing that, theyâve populated both sides of the marketplace (supply and demand) and become the go-to option.
The lesson here is simple: Business ideas donât need to be outrageous and world-changing. You can simply do something better. Just realizing that is powerful.
#4: Learn New Skills
One of the harder steps to take, right now, right here, but valuable nonetheless.
This is a bit of a backwards story, but it illustrates the point well:
The first business I started was essentially an online clothing store.
The only reason I was able to do that was because one holiday I had no money to buy new clothes. I was teenager and I wanted to look cool. I needed the âinâ clothes. Iâd chosen not to take a summer job and spent what money I did have on a new cricket bat. So my mom taught me how to sew.
The thing is, I was really nit-picky about how the clothes had to look. They had to look like the real deal. So I got good at sewing. I made clothes that fitted me perfectly.
By learning sewing that holiday, I was able to overcome one of the biggest hurdles clothing-entrepreneurs (that a thing?) faceâââcreating a great product. I was able to design a pair of shorts (they were for mountain biking) from scratch to fit like a glove. They were the best product in the market (hands-down) for the niche I was targeting. They are what made that company successful.
And the only reason I knew I could do that, was because Iâd learned to sew.
That skill opened up the window of opportunity to getting into a clothing business.
By selling the clothes online, I learnt e-commerce. E-commerce got me into the digital marketing world and so it goes on.
Learn new skills. Youâll never regret it.
#5: Live In the Future
Did I say the last step was hard? Oops.
If you can get this right, youâre miles ahead of everyone else. Mark Zuckerberg did. Heâs sitting quite pretty at the moment, no?
Long before the days of Facebook, Zuckerberg was already playing it out. He started a blog where he basically chronicled his life. It was like his Facebook feed.
By living in the future, the Zuck was solving a problem that none of us knew we even had yet. He was building a product that satiated a need we didnât know lay dormant within us.
To do this, you need to be extremely comfortable with failure. It is highly likely that you will fail at the majority of your predictions. Along with that, you need to either:
- Have vast experience in a certain industry which gives you great insight into the way the world and that industry is moving specifically; or
- Have insight and/or a way of thinking that most people donât possess. Youâre able to dissect society and understand the ebb & flow of emotions, trends and movements.
Predicting the future is hard business. If it were easy, thereâd be a lot more uber-wealthy people entrepreneurs.
Here are three that have done it, each with varying degreeâs of accuracy and boldness:
- Mark Zuckerberg,
- Jeff Bezos
- Elon Musk
They are all extreme thinkers. Theyâre not looking to compete on todayâs problems, this is their focus:
What does the world look like in 5, 10, 20 years time and how do I position myself to make that world a better place?
Iâm going to go out on a limb here and make some big predictions, just for the sake of it:
- Water scarcity is going to be a large part of the future.
- Sustainable living is not going to be a catch-phrase that some hippie people who recycle use, itâs going to be the way everyone lives. Very few huge supply chains. The majority of food you buy will be made/produced within 100 miles of your house.
- Education is going to get turned on itâs head, and its not far away. The education model is broken. People are starting to realize.
[cc Masterclass, Udemy] - People are going to pay a premium for genuine experiences. Technology has enabled a more interconnected world than ever. But itâs also facilitated the disconnection of it. As it becomes ever easier to connect with people and things, the novelty of it wears off. Genuine experiences evoke emotions in us that few other things do. There is no thing quite like sitting on Table Mountain drinking a jet-boil cup of filter coffee watching the sun rise to get you excited about life. People are going to pay for these experiences, rather than things.
- Climate change is going to be the next thing that changes the world the operates, like the Coronavirus has.
Donât put yourself in a box. Think big.
#6: Look Around You
// These are some quick pointers on places to look for opportunity.
Growing markets
Look for industries/sectors that are rapidly growing. Examples from recent times:
- Gig economy,
- Cryptocurrencies,
- Ghost kitchens.
Competition, but its weak
No competition means youâre probably ahead of your time. Validate thoroughly.
Weak competition means thereâs a market, but its being served poorly.
Opportunity to do it better!
Donât get into a race to the bottom
No one says it better than Seth Godin, here.
A race to the bottom isnât good for anyone, so donât get into it.
Never try and beat someone on price alone. Thereâs always going to be someone who can do it cheaper.
A bad experience
People love to complain. Use it to your advantage.
If you see and hear people complaining (either audibly or in places like Google Reviews, Yelp etc.), thereâs an opportunity to do it better.
Found out how you can do that.
#7: Exercise
Ending this off on a get-out-and-do-it note.
Two things you can do under this heading.
Exercise your idea brain
Write down 5 new business ideas every single day. Good or bad. Write âem down.
No restrictions. No judgement. Just write.
Go as in-depth or as shallow as you want. Dive into an idea, or simply write âIce cream that doesnât meltâ.
Itâs like warming up an engine thatâs being sitting idle for a while. Ideaâs are a creative outlet for your brain.
By writing every single day, youâre exercising that creative part and getting the engine ticking along again.
Exercise your body
The number one thing that helps me to think is exercise.
Specifically, aerobic exercise. As in, not super easy, but not super straining. Think of it as âthe pace at which you can hold a conversationâ. For me, that sits between 130 to 145 bpm. Any easier, Iâm hardly trying, any harder and Iâm focusing on surviving.
When Iâm in that zone, my mind is clear of the worries/humdrum of my day to day. Itâs a time to think freely.
Mix it with a good podcast, and my brain becomes a business idea machine. Itâs not uncommon for me to have 20 to 30 idea splashes (see next section) after a 2 hour run.
Thereâs a bunch of science behind it, which I wonât get into now, but it works for me and thatâs enough.
End Note: Systemize Your Process
As you start generating ideas, the more theyâre going to arrive. Itâs going to be like youâve opened the flood gates.
The trick is knowing how to handle themâââhaving a system.
Hereâs mine:
- Any idea that pops into my head (normally while running) goes into a Google Keep note called âIdea Splashâ. Itâs basically where I empty the contents of my head to keep bandwidth free. I never ever say to myself, âIâll remember this and write it down laterâ.
- When I finish what Iâm doing (normally a run, but sometimes work), Iâll have a read through. Anything that seems completely ridiculous (i.e I can spot an immediate oversight) I discard. I am not super critical of this.
- At the end of every week on a Friday afternoon, I empty my âIdea Splashâ note.
- I keep track of everything in Notionâââmy preferred note-taking app. Other good options include Evernote and Roam Research. (Productivity hack: Choose one and stick with it!)
- When I feel like having some fun, I choose an idea and pick it apart. I find holes in it, research the industry and make notes. If itâs worth something, I keep it. If its super holey, it gets deleted (Ideas are just ideas, can always make more!)
- The good ones I generally share on The Signal, a weekly newsletter where we start a business idea every week.
And thatâs it.
Thatâs the process.
Like it, got anything to add, disagree? Drop me a note!
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