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Introduction

The Ultimate Guide to Profitable Business Ideas

The Ultimate Guide to Profitable Business Ideas

The Best Way to Find a Business Idea — Fast

Over the past 12 years, I’ve helped thousands of students to create their own profitable businesses.

And the #1 obstacle that holds people back?

Finding a business idea.

Download the free PDF: 'The Ultimate Guide to Profitable Business Ideas'. The Best Way To Find a Business Idea — Fast

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It sounds crazy. After all, you can go Google “business ideas” right now and get 52,800,000 results. (Wanna be a dog walker?)

But if business ideas are so easy to come by, why is this such a huge barrier for people?

Here’s the rub: You don’t just need any idea.

You need to know:

1. If your business idea is profitable (so you don’t waste your time)

2. If your idea is something you care about

Anybody can hand you a list of ideas and say, “Run with this. Bye.”

But my approach is different. I’ve developed a system that guarantees you’ll find profitable ideas you enjoy.

Nail this and you’ll be well on your way to having a successful online business. One that gives you the financial freedom to do the things you love. Then you’ll never have to choose between paying bills, saving for the future, or investing in great experiences and products.

Don’t have any ideas? Or have too many ideas?

Relax. I’ve got you covered

Who am I?

Ramit Sethi, founder & CEO of GrowthLab

I’m Ramit Sethi, New York Times best-selling author and founder of I Will Teach You To Be Rich and GrowthLab. I’ve been featured in Fortune and Forbes Magazine, the Wall Street Journal, ABC News, NPR, and more.

Over the past 12 years, I have spent millions of dollars researching the best ways to help people find profitable business ideas and start successful businesses.

That’s what you’ll get today in this guide. We’ll cover:

  • How to start a side business no matter what your current situation (working full time, busy family, crazy schedule, student… we’ve got you covered in Part 2)
  • The 6 types of businesses you can start online and how to decide which one is right for you (Part 3)
  • How to discover if your business idea will make money BEFORE spending any money (Part 4)
  • The 5 things you need to go from $0 to $4,500 online, faster than you ever thought possible (Part 5)

How to Find a Profitable Business Idea in 3 Steps

Step 1: Start with business ideas that suck

Here’s the most liberating part of coming up with business ideas: You have permission to suck.

There are no bad ideas in the beginning stages.

Some of my early business ideas were terrible. But I’ve gone on to create more than 18 successful products.

The first step to finding a profitable business idea: You have permission to come up with ideas that suck.

Today, I’m going to reveal my system for identifying bad ideas — fast — so you can avoid costly mistakes.

And it all starts with this simple realization: You have permission to come up with ideas that suck.

Got it?

Once you’ve internalized this idea, you’re ready to move on to step two.

Step 2: Ask yourself these 4 questions

It’s easy to sit and create a list of random business ideas. But without the right framework, you can’t tell if these ideas will ever pan out.

That’s why we use this simple exercise to get the ball rolling.

The first part of this exercise is to ask yourself 4 questions.

Question #1: What do I already pay for?

I like to lead with this question because a lot of us can’t even fathom the idea that someone would pay them for something.

But when you think about it, we already pay other people for tons of random stuff.

For example, maybe you pay someone to:

  • Clean your apartment
  • Change the oil in your car
  • Make your dinner

When you start to make your list, you’ll quickly see that you pay other people every day.

That’s why I start with this question. It opens your mind to what’s possible when it comes to business ideas.

So take a second — right now — and think of about 3-5 things that you already pay for. Write them down on a sheet of paper and move on to the next question.

Question #2: What skills do I have?

What are you great at? Write those things down.

Remember, there are no bad ideas here. Your list of skills can include anything you want.

  • Are you good at cooking?
  • Do you speak Spanish?
  • Are you an Excel wiz?

As you make your list, you’ll start to see what people might pay you for.

For example: If you’re great at cooking, maybe someone would pay you to be a personal chef for them.

If you know Spanish, maybe you could tutor someone.

If you’re amazing at Excel, I know plenty of people who would gladly pay you to create some charts for them right now.

I want you to push yourself to come up with a list of at least 10 skills you already have.

Write down anything that comes to mind. Don’t filter any of your ideas.

Once you’ve got at least 10, you can move on to the next question.

Question #3: What do my friends say I’m great at?

This is important because it can be very revealing.

Maybe your friends are always saying, “Wow, you give amazing relationship advice. You’re the only person I come to.” Or, “Your apartment is so organized. I wish my place looked like this.” Or, “OMG, you’re always wearing the perfect outfit! I’m so jealous.”

You could turn all three of those things into successful businesses.

Sometimes it’s easy to forget we have these skills because they come naturally.

And if you find yourself thinking, “Ramit, I do not have any skills,” go ask your friends. It might seem a little weird, but I bet they’ll give you a list of at least 3 things you’re amazing at.

Add these ideas to your list. Shoot for at least 3-5 ideas and feel free to ask coworkers and family if you want. You might get different insights that way.

Trust me, you have many skills that have never even occurred to you.

Question #4: What do I do on Saturday morning?

This last question comes from my good friend, Ben Casnocha.

He said, “When you’re trying to find a business idea, think about what you do on a Saturday morning before everyone else is awake.”

  • What are you reading? Fashion magazines? Fitness books?
  • What are you watching?
  • What one thing could you do all day?

Another way to think of this is: If you were locked in a room with your friend, what could you talk about for 3 hours straight?

This is a great way to expose ideas and passions. The things you would have a blast sharing with the world.

By the end of these 4 questions, you’ll have at least 20 ideas written down. If you don’t have 20, go back and ask yourself each question again until you do.

Once you get to 20, you’re ready for step 3.

Step 3: Use the Demand Matrix to guarantee your success

A lot of people will just say, “Make a list. Have fun!” And leave it there.

But I want to take it one step further. We always test our ideas for profitability.

That way we can virtually guarantee they’ll be successful.

And for that, I want to show you a tool we use called the “Demand Matrix.” Here’s what it looks like:

The Demand Matrix: The Ultimate Guide to Profitable Business Ideas | growthlab.com

The Demand Matrix is a very simple way to take your 20 ideas from step 2 and figure out which of them are worth your time.

Before we get to that, I want to explain how this chart works.

In the upper right-hand corner of the chart, you’ve got Golden Goose. Ideas that fall under this section make great businesses. That’s because these ideas have the potential to get a lot of customers and command a high price. Think of companies like P90X and Apple’s iPhone — lots of customers, pretty high price.

Then, in the bottom right-hand corner, you’ll see Mass Market. Under mass market, you can still get a lot of customers, but you’ll only be able to charge a low price. Think of famous books you might read, like The 4-Hour Workweek. There are a lot of customers, but the price-point is pretty low.

Next, in the bottom left-hand corner, you’ve got a Labor of Love. These are business ideas that have few potential customers and can only charge a very low price. Any business idea that falls in this category is doomed to fail — before it even starts. This is your weekend hobby that nobody would pay for (like my dream of teaching people how to eat spicy foods).

Finally, in the upper left-hand corner, you’ve got High End. This is still a great business option because you can charge a high price, but you’ll likely have relatively few customers. Think about companies like Rolls-Royce and Prada.

I mapped out some products for my own business. That way you can see where some of our business ideas fall on the chart:

Completing the Demand Matrix: The Ultimate Guide to Profitable Business Ideas | growthlab.com

High End: 6-Figure Consulting System course. Since this course helps already-successful business owners make more money, it has relatively few customers, but it can command a much higher price. Successful business owners are usually willing to pay a premium price to grow their sales.

Golden Goose: Our Find Your Dream Job course fits here. This is a program where I show people how to find a job they love. Obviously the market for this is huge because 90+ percent of us have jobs. And because finding a Dream Job is something people really want, we can charge a relatively high price for the program.

Labor of Love: This is where we put all of our business ideas that will probably never see the light of day. Some examples might include an ironing course or a class where I teach people about spicy foods. Yes, those might be things that I love and am great at doing, but there’s not a big market for those. And if I do manage to find a small market, those people would not really pay.

Mass Market: This is where my book, I Will Teach You to be Rich, falls. Books are great mass market products because lots of people buy them, but the price is relatively low.

See how it works?

It’s a great way to test your ideas for (1) profitability and (2) demand.

It’s not meant to be super scientific. It’s just a back-of-the-napkin way to find out if an idea has a chance of being profitable.

There are no right or wrong answers.

To test for demand, just ask yourself, “Do a lot of people care about this?” If the answer is yes, then ask yourself, “Are people willing to pay a lot to solve this problem?” to figure out price.

Quickly you’ll see where your different ideas fall on the chart.

It’s pretty simple, but I want to make sure you go through each step thoroughly. Getting this right up front can save you thousands of hours over the long run. Click here to download a PDF copy of the Demand Matrix to fill in with your ideas.

Take it to the next level with this guide to finding profitable business ideas

By just taking the 3 steps above, you’ve put yourself ahead of 99% of people who think of an idea and spend years of time and tons of money before finding out it will never be profitable. Continue through the rest of this guide for the exact roadmap I use to develop and ruthlessly test business ideas.

Part 2: Start a Business While Keeping Your Job: 42 Side Business Ideas

Part 2: Start a Business While Keeping Your Job: 42 Side Business Ideas

Relying on a 9-5 job can actually be riskier than starting a business and I’ll show you why. We’ll also debunk the myth that you need to go “all in” to start a profitable business. I’ll give you 42 examples of business you can start right now even if you’re working full time, have a family, or go to school. Plus, you’ll meet people with busy lives who were able to turn ideas into profit.

Take Me To Part 2
Part 3: Online Business Ideas That Make Money While You Sleep

Part 3: Online Business Ideas That Make Money While You Sleep

Online business is about one thing: freedom. Freedom to choose projects that fascinate you, make money while you’re on vacation, buy drinks for your friends without worrying about splitting the tab, or travel whenever you want. We’ll cover the 6 types of online business (and which one is best to start) and 3 weird online business ideas that actually make a lot of money.

Take Me To Part 3
Part 4: Risk-Free Ways to Test Your Business Idea

Part 4: Risk-Free Ways to Test Your Business Idea

Validating your business idea doesn’t have to (and shouldn’t) cost any money. There are a few easy and fast tests you can use to determine instantly if your idea will be profitable. They are deceptively simple yet most don’t do them. In just minutes, you can move ahead knowing that your business idea is the right one.

Take Me To Part 4
Part 5: Take Your Business Idea From Concept to Profit Fast

Part 5: Take Your Business Idea From Concept to Profit Fast

You have a profitable idea, now what? I’ll give you the roadmap to get started — whether you’re starting a business on the side, going full time right away, or scaling up with an online business.

Take Me To Part 5
The Ultimate Guide to Profitable Business Ideas | growthlab.com

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The Ultimate Guide to Profitable Business Ideas