I like to call this the Opportunity Matrix. Think of it as an advanced Pro/Con list that forces you to think through your ideas and find the one that makes the most sense for you.
What’s that? You have so many ideas? So do I. And as much as I’ve tried, I’ve found that if I wanted one to be successful, I had to focus on just. one. thing. For example, I tried launching a gear and fitness site while also running Bikerumor, but it was just too just too far off on a tangent. Time spent working on that wasn’t providing the return (financially or emotionally) that even came close to offsetting the lack of attention on Bikerumor. So, lesson number one: Use the Opportunity Matrix to pick one and focus on it. Here’s the questions I asked for each opportunity:
…and in list form so you can copy/paste what you like. And to explain each one a little more:
- What is the Startup Cost?
- What will it actually cost to start this business idea?
- What is the Time Cost?
- How much time will it take each day/week, and can I afford that time?
- What is the Opportunity Cost?
- What will I have to give up to start this business? Up above, I wrote down a different question because that’s an important consideration for me. Things might include family time, free time for hobbies or sports, etc. Write down what’s important to you.
- What are the potential rewards for each opportunity? Think through all types of rewards. For me, they are:
- Excitement (how interesting is it to me?)
- Does it further my goals?
- See the bottom notes on the top page? I listed some of the personal goals that are important to me. Freedom is my top priority, so any business I start has to provide me the freedom to do what I want (travel, etc.). Before you even start this matrix, you should define what’s most important to you.
- What is the recurring revenue potential?
- What is the effort required for success?
- What does success for each opportunity look like?
- These last three go together and sort of reiterate some of the earlier questions. These repetitive variations help me think through things more thoroughly or approach it differently to come to well rounded conclusion.
- Can I do this while traveling?
- This one falls under “things that are important to me” and may not apply to you.
Don’t rush this. If you put honest answers down, it should be clear which opportunity makes the most sense for you. Important: This is only to narrow down the general business type that provides the biggest opportunity to meet your goals. Next, we’ll refine the actual business model and start setting things up. Now the real fun begins!
Bonus Material: Check out this video from Patrick Betdavid to get the creative juices flowing. It exemplifies the thought process we’ll explore in The Build Cycle podcasts to show how hundreds of other entrepreneurs found their niche within the industry they love.