Generating and Screening Business Ideas

1Why this matters

Most people who fail in business do not fail because they cannot work hard. They fail because they fell in love with the first idea that came to them, and then spent real money proving it before checking whether anyone wanted it. The first idea is almost never the best one; it is simply the first.

The skill this lesson builds is deliberately two-sided. First you generate widely — produce many ideas cheaply, on paper, where a bad one costs nothing. Then you screen hard — filter them against demand and your own resources, so that the only idea that reaches your savings is one that has already survived the filter. Generate wide, screen hard: the two halves protect you from opposite mistakes.

2Where good ideas actually come from

Ideas are not lightning strikes. They come from a small number of reliable sources, and once you know the sources you can go looking on purpose. Watch how one student, Keza, fills a page.

• Problems and unmet needs. The richest source. Keza notices that students at her school queue for 20 minutes to buy a single photocopy before exams. A problem people complain about is a business waiting to be built.
• Your own skills and hobbies. She is good at hairdressing. A skill you already have lowers your start-up cost and your learning time.
• Market gaps. There is no shop selling clean drinking water near the new bus stop, though hundreds pass it daily.
• Changes. New technology, new regulations, a growing population, a new road, a new fashion — every change opens gaps. When mobile-money use spread, thousands of agent kiosks became possible overnight.
• Imports that could be made locally. If a product is shipped in from abroad, someone could make a version here. This is import substitution, and it is the heart of the Made in Rwanda policy — think fortified porridge flour or liquid soap.
• Waste and by-products. Rice husks become fuel briquettes; banana stems become craft fibre. One person’s waste is another’s raw material.
• Improving on an existing business. Not every idea is new. Taking something that already works and doing it faster, cleaner or cheaper is a legitimate idea — the survivor in most markets is rarely the first mover, it is the better operator.

By working through the sources, Keza produces not one idea but eight. That is the point of the first half: quantity now, judgement later.

3Techniques for producing more ideas

When the list runs dry, techniques restart it.

Brainstorming

List as many ideas as possible with two rules: aim for quantity, and do not criticise anything while the list is growing. Judging too early kills the strange idea next to which the good idea was hiding. Criticism is the job of the screening stage, not the generating stage.

SCAMPER

SCAMPER is a checklist that forces you to change an existing product seven ways. Take “roasted maize sold by the roadside” and turn each letter:

• Substitute — roast soya or plantain instead of maize.
• Combine — sell the roasted maize together with a cold drink.
• Adapt — serve it in a paper cone so customers can eat while walking.
• Modify (magnify or minify) — add a chilli-salt coating; offer a large family pack.
• Put to another use — grind the roasted grain into a savoury snack flour.
• Eliminate — remove the roadside charcoal step by roasting in bulk at home each morning.
• Reverse or rearrange — let customers roast their own at your stall as a novelty.

One ordinary product, seven new directions.

Observation and problem-listing

Carry a notebook for a week and write down one thing that frustrates people every day — a queue, a shortage, a price, a journey. Problems are the raw material of ideas, and most people walk straight past them.

4Screening: turning eight ideas into one

Screening means judging each idea against fixed criteria so that you keep only the strongest. The danger it guards against is subtle: the idea that feels most exciting is often not the one that will pay. You need a method that argues back.

The tool is a weighted scoring matrix. You choose the criteria that matter, give each a weight showing how important it is, score every idea from 1 to 5 on each criterion, multiply by the weight, and add up. Weighting matters because the criteria are not equal — strong demand is worth more than weak competition.

Keza shortlists four ideas: A reselling airtime and mobile-money float, B making and bottling liquid soap, C rearing broiler chickens, D a phone-charging and printing kiosk near a school. Her criteria and weights:

She scores each idea 1–5 on each criterion, then computes weighted totals. Work two of them by hand.

Idea A (airtime / mobile money) — demand 5, skills 4, low capital 3, weak competition 1, profit 2.
Weighted = (5 × 3) + (4 × 2) + (3 × 2) + (1 × 1) + (2 × 2) = 15 + 8 + 6 + 1 + 4 = 34.

Idea B (liquid soap) — demand 4, skills 4, low capital 4, weak competition 3, profit 4.
Weighted = (4 × 3) + (4 × 2) + (4 × 2) + (3 × 1) + (4 × 2) = 12 + 8 + 8 + 3 + 8 = 39.

Doing the same for the other two gives Idea C (broilers) = 31 and Idea D (kiosk) = 31.

Read the result carefully, because it teaches the whole lesson. Idea A scored the maximum 5 on demand — everyone needs airtime — and yet it did not win. It lost on the criteria that actually decide survival: the margin per sale is tiny and the competition is everywhere. Idea B wins not on any single spectacular score but on being solid across all five, especially on profit per sale and low capital. High demand is necessary, but it is never sufficient on its own.

Practice

Answer. Waste and by-products. The raw material is something others discard, which means his input cost is close to zero — often the cheapest possible start.

Answer. Answers vary; two good ones: Combine — sell the soap bundled with a scrubbing brush as a washing kit. Modify — add a lemon scent, or mould it into a smaller travel-size bar for students in boarding school. The technique’s job is to make you look at an ordinary product from an angle you would not have chosen on your own.

Answer. Idea X = (5 × 3) + (4 × 1) + (2 × 2) = 15 + 4 + 4 = 23. Idea Y = (3 × 3) + (2 × 1) + (5 × 2) = 9 + 2 + 10 = 21. Idea X wins with 23. Note that if you had ignored the weights and just added the raw scores, X = 11 and Y = 10 — X still wins, but by a whisker; the weighting is what makes the demand advantage decisive.

Answer. Demand only tells you that people want the thing; it says nothing about whether you can supply it profitably. If the margin per sale is tiny (as with airtime) or the market is already crowded with sellers, or you lack the skills and capital it needs, then high demand simply means you will work hard to earn very little in a fight you may lose. Demand is one criterion of several, never the whole test.

Answer. (d). A friend’s enthusiasm is not evidence — the friend is not the customer and is not spending money. (a), (b) and (c) are all real, checkable facts about demand, resources and profit. Screening replaces “it sounds good” with “here is the evidence.”