Lesson Details:
February 14, 2020
Video Transcription: Now I'm gonna give you a practical example of one of my early bad business ideas and we'll play a game and you'll tell me what's wrong with the idea and you just comment on this video so first I'll tell you what the idea was it's an early idea of mine it's now that so there's no website you can look at but I'll explain to you what the idea was it was crowdsourcing and crowdfunding for a business idea let me explain to you what that means first people would post their business ideas for example mobile app for fitness or tutoring in local area or something innovative like the new kind of uber whatever their idea is they would post it others would come and comment on their ideas looking for holes and the ideas or having suggestions to make it better and this will get like a brainstorming situation going in the community and the brainstorming would make the idea much much better it's kind of like business planning but in the group you see so instead of you business planning or maybe you and just a couple of trusted business partners or advisers you'd have the power of the Internet and a lot of people would make suggestions many of them would be bad many of them would be good you would take the good ones and your idea would be far far far stronger and so that would theoretically make for a better business and then when a business is ready.
You get to the second part of this business idea that crowdfunding so the funding would actually happen on the site so you the an idea would get marked by the community as like ready to go it's a good idea the community approves it it's been crowd-sourced in terms of the brainstorming now the crowdfunding which is like collecting little sums of money from a lot of people kind of like Kickstarter or GoFundMe things like that but you'd fund that idea right on that same site and the founding team for the project would come right from the community itself ideally the people who were most active in the commenting and the brainstorming now think for a second there are many many many things wrong this idea I'll tell you what they proved to be but you maybe pause the video for a second think about it what's wrong with it comment on the video he wants and whenever you're ready just resume play and I'll show you what the problems are so let's go over what the problems were so first of all people are generally private about their business ideas they don't want to publicly post it on the internet so the good ideas would never get posted or a few good ideas will get posted this is not a terrible problem because even though a lot of people are private some people are relatively open so this would only be a partial problem but it is a problem the next problem is that it's really really hard to get intelligent conversation going online you really have to have an amazing community and that takes time to build I was actually I built the beta version of this site and I never got that level of great conversation going the founding team also should know each other before they start working together and ideally should successfully work together before.
So you can't just put random people who might not be in the same city on the same area to start working on this problem on this business because that's just a recipe for disaster so that challenge of like well who's gonna take this idea on now is a problem it doesn't have to be a huge problem because maybe the person who posted the idea originally keeps that idea and finds their own founding team and team members so maybe that issue doesn't have to be a huge one but the way I conceptualize that this would have been a mistake to have idea business founders come right from the site in reality what had happened is it was really hard to start this because when I launched it it was like a ghost town nobody was commenting absolutely nobody and the site essentially died for that reason I could never get that conversation going people weren't that interested in brainstorming and when they were at those rare times they posted subpar low-quality suggestions that didn't go anywhere and the conversation didn't really go anywhere also this needs programming and good design to the professional meaning you need either to have those skills on your team or to outsource and pay for this which is not necessarily that cheap so there's a little bit of money involved in doing this in a good way another mistake I ended up making was I allowed for any kind of ideas so people interested in app ideas maybe weren't interested in local business ideas or hardware business ideas or e-commerce and there was also it was also hard to get the level of expertise to be high on all the areas so because I also didn't choose a niche the site initially was too broad usually you would pick a niche and then you would grow into the broader vision but not have it all start all at once and I actually ended up doing it all at once and when really broadly which also did not help things so those were the major issues for this and that ended up killing that business so hopefully you guessed some of these and if you can think of more problems with this business I'd be actually very curious to hear about that so please post that in the comments.
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