Everyone has at least one idea for the next big thing.

I have been asked many times how to come up with a unicorn startup idea.

A startup is a young company founded by one or more entrepreneurs to develop a unique product or service and bring it to market. The first challenge for a startup is to prove the validity of the concept to potential lenders and investors. (Investopedia)

A startup is a modern version of an inventor.

What distinguishes a startup from other businesses, though, is the way a startup goes about doing that. One feature that most investors seem to agree on for the definition of a startup is a focus on growth.

I think everybody should do a startup or work for a startup.

Start thinking with the problem side (demand). What problem you are solving and why. First research about the size of the problem & why everyone has it. Is the problem accelerating and more and more people are expected to have it, find about the problems rate of growth? Next discover about the need to solve the problem urgently, why the problem is a pain and needs immediate attention. The frequency of the problem, the rate at which its solution is required (habit-forming) is a very attractive point to pitch investors. And to solve this problem there is a huge requirement of capital and resources to scale the solution, show enough evidence of multiple rounds of funding needs. Showcase the willingness for users to pay a price to avail of the solution for the said costly problem. If the buying of the solution is part of regulatory compliance or mandatory requirement it's a bonus.

Do not start with ideas — start with problems.

Let's take the example of a food delivery startup, does the user have the motivation to get food delivered at home anywhere across the city, does the app give the ability to the user to order food, do the payment and track delivery and finally the trigger point for frequently using the app is the frictionless user experience. To sum it up pitch to an investor a problem that is large, growing, needs immediate attention and is frequently needed.

In short a need for a pain killer that can offer immediate relief. A need to have solution and not a nice to have solution. Investors fund businesses and not products. One should not build a solution and then go out to find a problem to match the solution built. Do not try to be a gold digger entrepreneur who looks at the hot trend and tries to build a product because VCs are funding that sector. In short never work on an product for which you have search for a problem. Founders must first question themselves - who are we building this product for? And do we have enough understand and data on market readiness.

'If You Build It, They Will Come', maxim does not work for startups

There’s a big difference between having a disruptive product idea and building a scalable business around it. Conducting market research is the first step to determine if you really do have an idea worth pursuing. To begin with, an understanding of competitive landscape is a great way of comparing and predicting how your idea will stand up against the existing incumbents.

It isn’t finding just some random idea to build, it is finding the idea that you would love to build for next 10 years at least.

Ideas are fragile at early stage so avoid naysayers or pitching to someone who doesn't understand entrepreneurship. You will be discouraged, will doubt the idea, become nervous about the opportunity and then will end up shelving your idea even before it started. Talk to other startup founders, angel investors and VCs working in the startup ecosystem, they will help you nurture and validate the idea. Constantly investigate two things to validate an idea: “Why has no one done this idea before?” and “Why can I deliver the idea better?” Once you have the right answers start working on the business model, capital required and flesh out the 12-24 months journey on paper. By end of this exercise you will have your results if you want to pursue with the idea or not.

The path to success for startups is highly variable, but successful startups have a lot in common.

Corporates can turn good idea into startups & get it right.

Corporations especially thriving ones have understood that innovation, nimbleness and entrepreneurial mindset is tough to develop within the company. The problem is that if large corporations plan to do something truly new and untested, no expert in the world would be able to tell them if it’s going to work or not. While capital & resources not a constraint for these corporations but human capital is to develop an idea into a category defining business. With corporate venture capital (CVC) model it helps corporatations to turn a good idea into startups with the minimum possible amount of resources, effort, and time. CVC allows corporations to take small funding bets on innovative ideas through an expert fund manager. With the CVC model if the investment in the idea is successful, the corporations future business will benefit; if the idea fails, no direct bad PR for corporations while they will get a valuable early warning about pitfalls to avoid in that business. Below are the opportunity that can be explored by CVC

Corporates are on prowl for access to new ideas, markets and technologies

Good ideas are common, what’s uncommon are people who’ll work hard enough to bring them about.

About 100X.VC

100X is the first cheque, SEBI registered VC fund and an investment adviser. We invest in Indian startups at the seed stage. We are sector agnostic. We use iSAFE notes for investing. 100X is the first seed investors who see potential in startup idea, believes in the team & funds it when they don’t have an identity & are invisible to everyone else. 100X when investing in any startup, we treat each of those entrepreneur relationships as the beginning of 8 to 10 years of partnership journey.

Email your investment proposal on [email protected]

Visit www.100x.vc for more information.