In Lyle's words, "The road is littered with good ideas that never catch on." If you have an idea and you want to spend the money and time to make it real, have a business plan.
So, our next question to ask ourselves as we consider whether to go forward with our latest app idea is:
Do we have a good business plan?
A business plan is a written statement of your business goals, the reasons why your business is likely to achieve these goals, and the plan for attaining those goals. The plan should lay out your plan for revenues, marketing, growth, and next steps; it should detail your costs and identify the risks and how you will handle them. For more about writing a business plan, visit the U.S. Small Business Association business plan page at http://www.sba.gov/category/navigation-structure/starting-managing-business/starting-business/writing-business-plan or Entrepreneur’s business plan page at http://www.entrepreneur.com/businessplan/index.html.
As we draft our business plan, we are asking ourselves:
- Where are revenues coming in from? App store sales, yes. In-app sales, too? Advertising? Related brick and mortar products or services?
- What are potential costs? Hiring experts for marketing? Hiring a database developer to build a back-end?
- What are some of the risks and how will we overcome them?
- Are there technology adoption risks (e.g., like the "Level Up" app being adopted by some businesses but not others yet)? To mitigate this we could find a channel (a partnership with a company that would have--or could more efficiently develop--those relationships).
- Are there costs to attract enough clients to feed our data so that it is rich for new users, e.g., like a "Yelp" type of app. Without content, our app wouldn’t be useful. We could mitigate this by collecting data in advance to pre-load or we can partner with a brick and mortar company that has rich content and needs a partner to disseminate it.
The exercise of developing a business plan will uncover the risks and issues for you to assess and possibly overcome. Or, they can make it clear that this app sounds great, but isn’t viable for the money and time you have available. Another benefit of developing a business plan right away--even before developing your app--is that once it is written, you have it ready for review by potential investors or a bank loan approval.
Based on our business-plan writing exercise, we determined that our new app idea has some risk associated with it. We will need to carefully assess whether we drop some of the features that add this risk or whether we can stomach (and afford) to take it on.
Draft your business plan and see how your app stacks up.
And, when you’re done, take a picture of the “costs” or “risks” sections and dunk 'em with SoDunked! (or just dunk your boss and go start a business).