Vector of a lightbulb. Represents finding the right business idea to start a business.

How to Come Up With a Good Business Idea

Kody Wirth | Oct 29, 2023

Some entrepreneurs have a natural gift for generating ideas—most struggle. But without a good idea, starting a business will be an uphill battle.

Luckily, this is a skill you can improve with the right process and a little practice.

This guide will teach you how to generate hundreds of business ideas and identify what makes a good idea. We even have curated lists of ideas for you to explore. Let’s get started.

How to come up with a good business idea

Coming up with a business idea isn’t a strict process. It’s a series of methods to tap into, explore, and see if something sticks. 

Here are a few tried-and-true ways to generate a business idea:

1. Solve a problem

Your business must solve a real problem

The most successful businesses always do. But how do you identify a real-world problem? 

Try one (or all) of the following:

  • Think about issues you’ve encountered in your own life.
  • Reach out to friends, family, or colleagues.
  • Look through Reddit, Quora, and other forums.
  • Run a survey.

These are just a few ways to uncover actual problems. Once you’ve identified a few persistent issues, dream up possible solutions. That may lead you to a highly desired business idea.

2. Talk to family and friends

It’s challenging to think up ideas solo. So, reach out to someone you trust.

Your family and friends can be a great source of inspiration. Discuss your desire to start a business with them and ask for their ideas. 

They may have noticed a gap in the market, have a problem that needs solving, or have a unique perspective for harnessing your skillset. 

This outside input can be the spark you need to find a great idea. Plus, you’ll open the door for additional support—such as funding or partnership.

3. Make tasks easier

The best and most lucrative businesses are often the most mundane. They help solve basic problems by making them easier or more efficient.

To hone in on these simple issues, walk through your day. What tasks do you dread? What undesired work takes up your time? 

These often overlooked pain points are likely screaming for solutions.

4. Build on an existing product or service

A great business idea doesn’t require reinventing the wheel. 

Instead, take an existing product or service and make it better. Improve the design, add new features, or find a new way to market it. You may even be able to introduce a product or service to an underserved market. 

Start looking at the things around you and ask—how could this be easier? How could it be more intuitive, less stressful, and more pleasant? How could it be more affordable?

You may find that even the slightest change will create something unique.

5. Start with a hobby

Your hobbies and passions can be a great source of business ideas. Whether you love baking, photography, or gardening—there’s likely a way to turn your hobby into a business

You just need to determine how to monetize your skills or the products you create. If you’re unsure how take it slow and start with a side hustle. You’ll still need to consider pricing, expenses, and how much time to invest—but you’ll have less risk and more time to adapt your hobby into a business.

6. Jump on a trend

Trends can provide excellent business opportunities. Whether it’s a new technology, a fashion statement, or a change in consumer behavior—spotting and capitalizing on emerging trends can lead to successful business ideas. But, there are potential complications you should be aware of.

A very small or non-existent market for this product or service is likely. You’ll need to showcase the problem to stimulate a need many didn’t know they had. Just be sure it has staying power (like AI tools) and is not just a fad (like fidget spinners).

You should expect multiple competitors to emerge as the trend gains traction. Focus on solidifying your brand and build loyalty early on to stay ahead of imitators. 

7. Innovate

Innovation involves developing something new or finding a novel approach to an existing product or service. This requires creativity and a willingness to take risks. Still, it can lead to unique and successful business ideas.

Remember that this may mean no current market for your product or service exists. But if you believe there will be a problem and can convince others, you may be at the forefront of an untapped movement.

What are the qualities of a good business idea?

There’s no genuinely perfect business idea. However, there are clear signs that an idea is worth pursuing and more likely to succeed. 

Clear market demand

There must be a need for your product or service. Meaning your idea needs to, at a minimum, solve a real-world problem for your target customers

That’s just the start. 

Will people pay for a solution? Is there a real opportunity to disrupt pre-existing alternatives? 

It may not be a good idea if the answer is no to either question. 

Scalable and profitable

Scalability and profitability are tied together. 

An idea is scalable if you can:

  • Attract more customers.
  • Accommodate this increased demand.
  • Lower costs as you grow.

An idea is profitable if revenue exceeds expenses. 

Now, your business may take time to be profitable. But it should display the ability to grow and scale to achieve profitability. 

If your business idea can’t bring in more customers or decrease costs—you’ll struggle to be profitable.

Fits your goals

Do you want to monetize your passion? Grow quickly and sell? Create a legacy to pass down to your kids?

You need to know what you hope to get from being an entrepreneur. Because only some business ideas will fit your goals. 

So, make sure the business fits your motivation. If it doesn’t, you’ll find it is far more challenging to keep up long-term. 

No business idea? Try these

If you’re struggling to develop a business idea, check out one of our curated guides for inspiration.

Coming up with an idea is just the first step

Once you have your business idea, it’s time to validate if it will work

You’ll need to chat with potential customers, run tests, and explore the financial implications of starting your chosen business. If that sounds tough, don’t worry, the next section of our startup guide will help you understand if you have a good business idea.

For now, pat yourself on the back for getting this far. 

Sorting through the thousands of potential options and finding something you believe can be turned into a business is a big step. Now, you need to determine if your idea can become a legitimate business.

Resources and tools to find your business idea

Make researching and selecting a business idea easier with these templates and tools.

Business ideas FAQ

There are no business ideas that guarantee success. However, you can tell if a business idea is good if it solves a problem, meets a market need, and aligns with your skills or passions.

You cannot typically patent an idea on its own. You may be able to patent an idea if it involves a unique process, method, or product—but you should consult with a patent attorney to understand your options.

To come up with a good business idea, you need to identify a problem you can solve, understand your target market, and verify that there’s demand for your product or service.

Entrepreneurs get their ideas from various sources, including personal experiences, hobbies, market trends, customer feedback, and industry knowledge. They often identify gaps in the market or find innovative ways to improve existing products or services.

The most common sources of new business ideas include personal experiences and interests, customer needs and feedback, market research and trends, and brainstorming sessions. Other sources can include academic research, trade shows, and networking events.

If you’re worried about being too similar to another business, conduct a patent search to see if your product or process is already patented. You can also search online and in app stores for the same or very similar ideas.

Share your idea with trusted friends and family who will give you honest pros and cons. Reach out to mentors, SCORE counselors, or other advisors for unbiased perspectives on your idea’s viability.

Make a pros and cons list for each idea. Validate market demand for each. Go with the idea that best fits your skills, interests, and financial resources.

There is no single foolproof idea. But some options, such as services, online shops, and resellers typically have lower barriers to entry and require far less upfront investment.