At least since the invention of the light bulb, the world’s greatest tech businesses were launched on the wings of one beautiful, innovative, market-changing idea. Karl Benz’ Motorwagen kicked off the automotive industry. Willis Carrier’s air conditioner did the same for the cooling industry. Radio, television, transistors, the personal computer, the internet, ecommerce, the search engine, digitized music, and social media—each began with a single great idea, and grew to transform our lives.
But how? How do entrepreneurs do it? Where do great ideas come from, anyway? I sat down with Stanford Design Innovation Professor Jeremy Utley, author of Ideaflow: The Only Business Metric that Matters, to get to the heart of this very question. Together, we learned that there’s really no magic to coming up with good ideas. It just takes consistency and effort to generate a lot of ideas, test the best of them, and honestly evaluate their appeal to the marketplace.
Here are four simple steps that anyone can use to generate great business ideas:
1. Make “idea connections.”
Let’s face it—coming up with a brand new idea is hard. It’s terrifying, actually. If you ask someone to generate new ideas from scratch, they usually freeze. But the good news is—that’s not how creativity works. These “new” ideas are really just connections between existing ideas. This is what Steve Jobs meant when he said “Creativity is just connecting things.”
The key to creating new ideas, then, is to just be open and exposed to lots of ideas from different fields and areas of interest. You can try to combine them in ways that nobody thought of before.
What if you made a fully electric luxury sports car? Dopey idea until Tesla made it work. What if you put a data warehouse in the cloud? Pretty dumb idea until Snowflake proved it wasn’t. What if you trained a language model on the entire internet? You know how insane that was? Open AI.
2. Create dumb ideas—lots of them.
One thing that holds people back when trying to brainstorm new ideas is the fear that their ideas won’t be good enough. But thinking that way leads to paralysis. That’s why the very first rule of idea generation is to give yourself permission to come up with dumb ideas.
Just like anything else, ideas follow a natural bell-curve distribution. On one side you find a few truly wrong and awful ideas, in the middle are lots of “right” ideas that are just too obvious to be of much use, and on the other end are a precious few brilliant ideas that just might work.
According to research across disciplines, the single most important factor in creating great ideas is not quality— it is quantity. Write out hundreds of ideas if you need to, until some unexpected and interesting ideas naturally start to emerge. The averages don't matter. All that matters is that you eventually find at least one truly great idea.
One way to make sure you keep generating ideas is to simply force yourself to write down five or ten ideas a day, no matter how bad they might seem. Then keep cycling through them, adding and changing them as you get your creative juices flowing. You can also keep a “bug list”—that is, a record of everything that bugs you. This will train your brain to be aware of problems that need solutions.
Sheer quantity matters because it forces you to push past the obvious, bland ideas. As you go deeper, you're challenged, churning out increasingly oddball concepts. Eventually one might just make you go, "Wait a sec, could this actually work?" That's where brilliance is born.
Measure ideas at this stage by which ones get you excited–which ones linger in the back of your mind for days. Forget the MBA analysis, these are the ones you should test.
3. Test your ideas, quick and dirty.
“That will never work.” These four words have killed more great ideas than any other in the history of ideas. I can only imagine how many truly great ideas are sitting in the bottom of garbage dumps because someone just couldn’t see how to bring them to life.
Even more important than having a process for generating good ideas is having a process for testing multiple ideas in a quick, affordable, and realistic way. Innovation is a “low probability effort.” If you can take a handful of possibly good ideas and test them to get objective feedback, you can improve your odds of success considerably.
You don't need a working prototype, let alone a full-featured product to test an idea. Many great ideas were validated with minimum viable products (MVPs), faked demos that merely mimic the end product, or even just powerpoint slides or 3D renderings.
When you are testing out ideas, there are naturally a lot of things to consider. Engineers tend to be focused on feasibility—”Can we make this?” Business people care more about viability—”Can we make money with this?”
While both of those things are ultimately important, at the idea testing stage, there is only one factor which you should consider first and foremost. That is desirability—”Does anyone want this?” Because if that’s not there, then the other two considerations don’t really matter.
You’re not looking for broad desirability. Not “everyone we talked to was interested!” No, you’re looking for intense desirability.“ This particular segment of users are tearing it out of our hands!”
4. Find your target customers.
It's easy to get opinions from friends, family, investors, and mentors. But if they're not your target user, then you really should ignore their feedback to your demo.
When you are testing, you're looking for a subset of the people you reach out to have a clear, passionate interest in your proposed product. Intense demand from a small, targeted group of people is better than moderate interest from a large population. The singular thing you're looking for is whether your target customer gets excited enough to commit in some way.
"Wow, that's cool" is not a validation.
"Yes, I’d buy that" probably is.
But "Here, please take my money now!" is the best.
Focus on finding where the demand is, and then understanding how best to fulfill that demand. Everything else is noise.
At the end of the day, ideas don’t come from thin air. They come from constantly combining lots of ideas, considering if the “idea babies” solve an urgent need in the marketplace, and then rapidly testing solutions until you find one that is feasible. If you can solve a major pain point for a particular group, and that group is prepared to pay for your solution, then congratulations—you might just have a great idea!