It is now three years since Joram Mwinamo and his business partners started their professional services business known as SNDBX.
Mwinamo recalls that when they were starting this venture in 2019, they wanted to implement a unique idea that had not been done elsewhere.
“SNDBX evolved out of the need for more than just strategy consulting services. I realized that many people had to travel to other offices or look for other consultants for these services,” says Mwinamo.
He set out to start a business that would be a one stop shop for all the professional services an entrepreneur needs.
“We managed to get a funder who invested USD 500,000. As we scale up, we shall now be looking to rope in other financiers. Access to funding and strategic partners has helped SNDBX grow,” he says.
The business currently has 33 different professional services. These include services in areas such as legal, accounting, HR, governance, tax.
“Our survey shows that there is no other enterprise doing the type of business we offer in the region, and probably in the continent,” he says.
Mwinamo’s business growth shows the power of a unique idea to make money. It also shows that when you have a very good and workable idea, it will be easier to get capital funding.
“Many people let the sheer lack of capital deter their dreams. It should not be so. A good idea without capital is better than good capital without an idea,” says Sam Jim Mwanyasi is the Chairman at Spectrum Group of Companies, a conglomeration of various businesses in Micro-Finance, Risk Management and Business Intelligence, Civil and Building Construction and Events Organization.
So how do you tell that the business idea you have will make any money for you?
What is the competition?
From onset, your idea must be cognizant of the potential competition. This means that you must research and survey whether similar or closely related ideas have been previously implemented.
“It will be a huge negative if your idea will be executed in an overly competitive space. The product, the service, the market, and the targeted customers must not be overcrowded,” says Kevin O’Leary, an entrepreneur and investor on the entrepreneurial investment reality show Shark Tank.
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His sentiments are echoed by fellow investor and entrepreneurship author John Boitott.
He reckons that a major green light to proceed with the implementation of a business idea is the discovery that one or two organizations are operating businesses that border around it and that there is still a large market cap for the idea’s prospective product and service.
What are your target customers saying?
Your business idea must be based on what customers are saying. This means that you must examine what the potential customers are lacking in the already existing products and services.
You can do this by listen to their needs and their perspectives on the existing and new business concepts.
For example, you can single out a few market-savvy individuals and carry out a survey on the gaps they would wish a fresh business venture to come into the market and bridge. This will also help you gauge the viability of your idea.
What’s the idea’s validity date?
Go beyond the idea or its business name and develop an actionable business plan.
For example, if you are looking to venture into the errands or supplies business, come up with a plan that shows how you will run your customer errands, your mode of transport and delivery, and regular drop off and pick up routes, and in supplies, where and how you will source for customer supplies, and how you will fund your local purchasing orders (LPOs).
This is what will primarily determine if your idea will work, and whether there are resources to fuel it.
“A business plan is what every angel investor or financial institution will look at before investing in it,” says Keziah Muriuki, a Nairobi-based business coach who specializes in start-ups.
She says that it is also what large scale customers will evaluate before deciding to sign a service deal with you. Your business plan must address key concerns such as sales and marketing, business development strategies, financial forecasts, and strengths, weaknesses, opportunities and threats.
Is it unique or easy to replicate?
Your business idea must stand out both in its format and the solutions it seeks to provide. If there are similar solutions in the market, the only way your business idea will find a shelf space is by providing better efficiency.
“Successful entrepreneurs are not necessarily those who give birth to an idea. There are also highly successful businesses that were started as a fine tuning venture of existing but inefficient ideas and businesses,” says Keziah.
Can it be commercialized?
Your business idea will remain worthless if you do not commercialize it. Commercializing an idea is also the best way to tell if your idea has the potential to make money.
“An idea, no matter how good, is worth nothing until it has paying customers,” says angel investor Alan Hall. Nonetheless, commercializing an idea does not mean that it will break even instantly. You must learn to obey the process of business development, put in the work, and be patient for it to gain traction.
Alan also recommends that you develop a series of ideas, and then eliminate the bad ones quickly without losing too much money, time or energy.
You must be careful not to launch too many businesses that will stretch you thin. Bear in mind that each single start-up is an all-time consuming venture.