“What makes for an ideal entrepreneurial opportunity?” is the question commonly asked when deciding on a new business venture. When reviewing a business opportunity there are three primary aspects to look for: Market size, Technology and Team.
The most important requirement for a good investment is a large market opportunity in a fast-growing sector. That means a strategic view that includes evaluating market growth, market size, competition, and customer adoption rates. Another big determinant of success is the sector. When you invest in the right sector even if the team is mediocre, or the implementation isn’t as good, the rising market will lift all the companies in that sector.
The second factor involves a competitive edge that is long lasting. It is usually an engineering challenge that is tough enough to give the company an edge, which will result in a several year’s technological lead or longer. To create a barrier look for a tough problem that has not been solved before. Patents are strongly suggested.
The third factor is team. Look for engineering vision and execution, sales and entrepreneurship in a team. The best once are willing to reexamine their assumptions and are prepared to bend left or right or rotate all the way around when the data suggests they are headed in the wrong direction.
This business model has much to offer. It serves as a great check point, and of course can be adjusted to whatever the business venture is. There are countless business opportunities and following the above mentioned steps correctly can save you from making a bad business decision. This model will help determine if the business opportunity will succeed or fail.