Let us be the first to congratulate you on making the decision (important step one), and then taking the action (arguably the most important part), towards starting your new business.

It’s an exciting time, and we wish you all the best and we hope you get to experience what we have, that there is nothing better than owning and operating your own show!

Now down to work…

A rational mind, and considered decision making is now in order. You need to ensure you don’t get too caught up in all the excitement and develop a blindness to the telltale signs that your idea while being a good idea, may not actually be a viable business idea.

A mentor of ours can often be heard saying “I hate new ideas” when it comes to starting a new business. “I prefer you find a good existing idea, that already works, and then do it better!”

Now we don’t entirely share the sentiment, at the end of the day, where would modern unicorns like Facebook, Uber, AirBnB and the like be if the founders stuck to that mantra.

Having said that, there are two points worth considering –

1. The idea does have a basis in fact, new ideas are great, but so many don’t translate into viable businesses. Or if they will, they will require a very substantial capital backing to reach their tipping point. How do you know your ideas tipping point, if it’s going to have one, is within your reach?
2. Those examples we just gave you, to a large extent are actually in fact just improvements on existing businesses. MySpace (amongst others) existed before Facebook, Mark Zuckerberg just did it better. We all know Uber has just taken the idea of taxis (and in particular unregulated private cabs in places like London) and did it better. AirBnB, it might be a bit of a stretch, but really the basis was just doing flat sharing better!

The point is new business ideas are tough, so put the work in up front, before a mistake is made.

More about Accounting & Tax