Evaluating Business Ideas
An Idea-Screening Technique
Tim Wolters, chief technology officer of Collective Intellect of Boulder, Colo., and founder of two previous technology companies, advises entrepreneurs to keep a notebook of their ideas and elaborate on them over time. On his blog, http://timwolters.blogspot.com, he suggests beginning with a hypothesis, which is "a simple statement that captures the gist of the solution," as in "Mice can be driven away, eliminating the need for a trap."
For those ideas that still seem interesting some time later, he recommends beginning a separate journal and considering the idea in terms of problem and solution. Thus, for the mouse idea, the problem could be "Mice are a problem and traps only provide a temporary and messy solution." The solution: "Create a device that discourages mice from coming on the property."
Next could come ideas for creating a prototype of an invention. "This invention chronology can be used later for the patent process." Conclude by answering basic marketing questions, such as who will benefit and how many prospective customers are out there (see BusinessWeek.com, 12/13/06, "Harnessing the Power of Marketing").
Here's a Reason to Incorporate or Become a Limited Liability Company
Microsoft's (MSFT) new Internet Explorer 7 provides a security certificate available only to corporations, LLCs, and partnerships. It turns their URLs a reassuring green, so consumers who visit their Web sites are less likely to be taken in by "phishers" masquerading as legitimate businesses (see BusinessWeek.com, 4/3/06, "Phisher Kings Court Your Trust"). The problem with the certificate is that it's not available to the many millions of sole proprietorships, which thus run the risk, as the certificate becomes widely used, of scaring off consumers with their regular black-on-white URLs (though the URLs of those suspected of or identified as phishing will show up as yellow or red). The main drawbacks of being incorporated are that different tax rates may apply and that many states have minimum corporation taxes. Also, there is additional paperwork to show at annual meetings and director meetings.
Tips for Entrepreneurial Geeks Seeking Jobs
Try to create add-on applications or extensions for enterprising companies you think you might want to work for, advises Colorado private investor and entrepreneur David Cohen in his blog, www.coloradostartups.com. Also, participate in forums and blogs associated with these companies. Possibly best of all, get to know some company insiders.
A New Nonprofit Pushes Consumers to Purchase from Local Businesses
The Interra Project, www.interraproject.org, promises to link credit and debit cards into a rebate system that "rewards consumers for purchasing from locally owned and sustainable businesses [and] automates donations to nonprofit organizations." Among the movers and shakers at Interra are Dee Hock, founder of Visa International, and Greg Steltenpohl, founder of Odwalla (KO), the juice company. If it catches on, the approach could give smaller local businesses more equal footing with the franchises and corporations that predominate at malls.