Deciding what type of business to build

Last year, I shut down some websites I built.  They weren’t making me much money, they were taking up a (relatively) large amount of my time, and I just wasn’t having any happiness from working with them anymore.

That’s left me with the time and energy to focus on building a new business.

However, I didn’t know what type of business to build.  As a programmer, I have many easy choices; contract programming company, software-as-a-service website, training classes, etc.  I also have always wanted to have a company that physically builds something.  With several choices, I didn’t know which one I really wanted to go with.

Fortunately, I previously wrote a program that helps me make decisions when I have several options and several things to factor in when making my decision.

So, in an attempt to make a better choice, I dug out the program and put in my question.

The Options

Here’s a list of the possible choices I was considering:

Options

Nothing too surprising for a person with many years of programming experience – expect maybe the leather goods business (I’ve always wanted to make really nice leather luggage).

The Factors

Then I added in the factors I was considering:

Factors

The weighting are relative scores for how important the factors are to me.  So something that has an 8 is twice as important to me as something that has a 4.  Mostly, I want a business that is simple to operate – few employees, little/no physical inventory – and has the ability to make me a good amount of money, without me needing to spend all day working on the business.

Then I started doing the weighted-pair comparisons.

That’s a technique where my program shows me one factor and two options.  I then click a button to indicate which option is better for that factor (or, a third button, if they are equal).

The Results

After going through all the questions, the options get a ranking, based on my answers.

Here are the results for me:

Results

As you can see, a Software-as-a-service app was the clear winner.  I wasn’t too surprised by that.  However, I was a bit surprised by how low some of my other choices scored.

The Decision

Now that I could see, in very clear numbers, what option best fit into my life, it’s easier to go that route.  Before, I was tempted to do a little bit of several ideas.  But that just leads to not doing anything 100%, and wasting my time and energy.  Now the answer is clear.

The Next Steps

In the past, I’d be tempted to take this information and decide what app to build.  But that hasn’t been very successful.  So I’m going to try some of the ideas mentioned in most lean startup books.  I’m going to find a market with a hungry demand for something.  Then I’ll write a program that fills that need.

The problem I have now is that I don’t know what market to investigate, or even really how to find good markets.

So, in keeping with my new desire to do the steps of this process more scientifically, I decided to do a brainstorming session to find ways to discover a good market.  The details about how I went through the brainstorming process will be in my next post on this subject.

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