As an angel investor, I sometimes worry that all the viable unique ideas must already be taken. Entrepreneurs keep talking to me about the Internet of Things (IOT), autonomous vehicles, inter-planetary travel, and other exciting opportunities, but the majority of real plans I get seem to be “me too” variations of several common themes that have already been done too many times.
We all want to get out there ahead of the crowd, and invest in that truly innovative idea that seems so obvious in its appeal that you wonder why nobody ever thought of it before. Examples in the past, that were not huge leaps in technology, would include the light bulb, telephone, the zipper, and post-it notes. I haven’t found the next one yet, even on Shark Tank.
On the other hand, I do see often myriad concepts that have already been tried and failed many times, where the space is crowded, or it’s not clear that another variation with more features, slightly lower cost, or more usability, is worth the effort. Here are some of my favorites in these categories:
Virtual talking personal assistants.
By definition, these are all really thinly disguised Internet search engines, provided by or competing against the 500 or more existing search engines already out there, including Google, Microsoft, and Yahoo. There may be room here for something really innovative, but just a sweeter voice will probably not do it. If you have more money than the incumbents, try it, but don’t look for investor help.
Password storage and recollection schemes.
Everyone is looking for an easy solution to the increasing need for complex security and multi-factor sign-ons required by most applications today. So far, yellow stickies on your computer seem to be holding the lead, despite a multitude of password manager apps, biometrics, and encryption schemes.
Yet another social networking site.
Just for starters, Wikipedia now lists about 200 sites by name, which they claim is just the more notable existing social networking sites. I still get about one business “idea” per week for a new networking site, which will combine the “best of all the sites” into a new one. If you must do one of these, I suggest that you skip the improvements, and focus on a niche, if you can find an unoccupied one.
The ultimate online dating site.
Based on my own initial research, there are over 8,000 existing ones world-wide, supplemented by two or three new ones per day. Most of these will fail, or never turn a profit. I hope you have a better idea than SugarDaddyForMe, or Meet-An-Inmate. But then, this is an emotional need every single professes a demand for (not to mention the 40 percent of applicants who are already married).
Jump into the new sharing economy.
How many more personal things are you willing to share or collaborate on to make money? Everyone wants to be the next Uber (ride sharing), Airbnb (room sharing), Chegg (book sharing), or GwynnieBee (clothes sharing). Before you step into this space with a first-time passion, you might want to check the list of over 200 companies already there.
No more shopping for food or cooking. Despite the spectacular failure of Webvan many years ago, this one keeps coming back. Currently Grubhub in the US and Deliveroo in the UK are showing some success, but new ones continue to pop up and fail every day. Fewer and fewer people love to cook, or the time it takes to shop for food, but time costs money, and everyone today expects services on the Internet to come for free.
Mobile apps for everything and anything. Today there are well over 2.2 million mobile apps available to download for iOS devices, and even more for Android devices. Unfortunately, less than one percent of these ever make a profit. Granted, a mobile app business can be started for as little as ten thousand dollars, but it’s hard to make it up in volume if you lose money on every download.
Somewhere below this list is another tier of questionable potential startups, including more Amazon e-commerce knock-offs, photo sharing sites, music sharing sites, and more ultimate video games. Web site generators have made it cheap and easy to launch a site, but that doesn’t mean it’s easy to succeed.
In my view, the single biggest reason for startup failures is a lack of real innovation. Changing the user interface, and adding a couple of features doesn’t compensate for not being there first. The second biggest reason is lack of focus. Combining the features of several successful products will not assure success (“something for everyone”).
For other ideas, the wave has simply passed. Rather than trying to extrapolate linearly from solutions already popular, be the first to solve one of the myriad of current and future problems causing real “pain” in our society. Problems like health care and diseases, or alternative energy solutions, offer a wealth of possibilities, with huge potential paybacks for everyone.
These also have the potential of satisfying a higher purpose (socially conscious), as well as making money. The rewards are greater and longer lasting, and it’s a lot more fun. What are you waiting for?