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By Thomas Baekdal - March 2011

You Business Model is Your Idea

Om Malik wrote a good article about Twitter called, "What Is Twitter's Problem? No, It's Not the Product." It highlights the problem of being too focused on the product.

As a publisher writing about new media, I get a fair share of emails from startups trying to pitch their idea. I am always excited about what people are making (so keep sending them), but it is also clear that many startups have no real product.

It basically comes down to this:

Your idea must be your business plan

When your idea is not your business plan, you are not running a startup, you are running a hobby!

As I wrote in "How to Survive in a World of Abundance," our world has turned into one big market. Everyone is doing everything, and we are all competing with each other. The competition is people's time.

Yes, you can get a lot of exposure and traffic, if you have a great idea and make that available for free. But as we were supposed to learn after the dot.com bust, abundance+free, doesn't result in profit.

It is amazing how many startups come out with an idea that is basically just that they can do HTML5 + jQuery. Just look at the many news aggregators out there. They are pretty and looks like a magazine, but nobody is going to pay for formatting. Especially not when you can just use a huge number of other free alternatives that are just as good.

Aligning your idea with your business plan forces you to put your customers first.

When you just have an idea, based on features or functionality, it is driven by a desire to fiddle around. If you are an amazing developer, it might turn out to be spectacular. Nevertheless, an idea based on your business plan, forces you to think "how can I make something that is valuable enough for people to pay for."

Startups that aren't about creating value for others really do not stand a chance in a world of abundance.

 
 
 

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Thomas Baekdal

Founder, media analyst, author, and publisher. Follow on Twitter

"Thomas Baekdal is one of Scandinavia's most sought-after experts in the digitization of media companies. He has made ​​himself known for his analysis of how digitization has changed the way we consume media."
Swedish business magazine, Resumé

 

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