I am since fully unemployed, which means the good ideas at this moment are being fully utilized. But that doesn’t mean if you want to learn more, there isn’t a good place to gather some knowledge. I am over at Slang Dang now attempting the American Online Dream of launching a profitable web app. Check our progress here.
This blog wont be untendered forever. It will be back, but until the new ideas are less focused and without personal use, I’ll be dormant. Cheers to you all.
Invention: Disposable Scarfs
Type: Consumer Good
Summary: Do you like the warmth provided by a scarf but always seem to be losing them? Do you sometimes not wear a scarf if you think you wont remember it when you go to pick up your jacket? The disposable scarf is your solution
Explanation: A roll of fabric perforated into 10 or more long lengths that may be used as a scarf. The material would be think fleece or other cheap fabric typically used to make scarfs. This would allow the user to carry a scarf without the fear of loosing it and to always have a scarf on hand for cold nights.
Utility: Scarf that keeps you warm in an easy format that is cheap to produce.
If one is so inclined to go down the product route: Design something unique, find a producer, market and brand it and sell direct retail or wholesale, it all starts with the first step: Designing something unique.
I adhere to the Seth Godin philosophy on product design from his book The Purple Cow: Big time marketing doesn’t work nearly as well as it use to. You have to come up with a Purple Cow, or a product that is interesting enough, in itself, to get the attention of the buying public. Coming up with such an idea is tough, but should you get a strike, the profit and freedom it can afford you is great. My product, the HoboHookah, was such an extension of creativity that has proven to so far generate its own press and interest.
But how does one come up with such an idea? 99% of the time, it will be a slight innovation on an existing product. I recommend two sites to get the pulse of the creative product designer: NOTCOT.org is the central repository for cool new products. Getting your idea on that site opens yourself and your product up to the entire web of Mavens who will buy and spread your idea. To some degree, its like being a garage band and hearing yourself on the radio. It is also a great place to see what other people are coming up with.
The other site is really more a playground for the pros: Experienced product developers and designers communing with each others innovation, its called Kancept.com. Kancept is simple: Post an idea to the community and get their reaction: Would you buy this? Yes/No. Its the first place to go to get instant feedback from experienced developers.
To echo my last post, an innovative idea isn’t enough. You have to worry about scaling your idea, costs, marketing, can your demographic buy?, and capital requirements on top of it all. But before you worry about the logistics, come up with a good idea, get some feedback and then look into all of that other fun stuff once the idea shows promise.
One of the more interesting aspects of entrepreneurship is identifying and understanding the underlying nature of different business models. For this post Ill explain the nature of Capital Requirements vs different measurements of return.
In many instances, the perfect business model requires low amounts of capital and has high returns, or profits. What will keep many business ideas from reaching fruition, especially for first time business builders, is the lack of capital. The next thing to worry about is cash flow. Finally, you will want to gauge the amount of return and evaluate this based on both a Return on Capital (measured in percent) and Absolute Returns (measured in currency), to make sure it is worth while pursuing.
Different business models have different capital requirements. Services typically have much lower capital requirements than manufacturing or product driven businesses. As such, if you have low amounts of personal equity (held assets like cash in the bank or property) and limited access to credit or loaned capital than the most viable start-up business is one that is driven by a service you provide. These businesses can then generate cash flow to either scale the new business (add additional personnel or move the business to a commercial office) or fund the capital requirements of another business that you wish to endeavor.
Once you have identified a business with capital requirements that you can meet, than you will want to evaluate the business based on its returns. Ultimately, a low return business will be very difficult to manage. The lower the absolute returns, the harder you will have to work in order to make ends meet. Most services have low margins, especially in established service sectors (like restaurants). Product based business tend to have higher margins, but the higher capital requirements can make your Return on Capital much lower than services.
If you meet the capital requirements and the returns look good in an absolute sense, than you last need to understand your cash flows. Many service oriented businesses can generate immediate cash flow, which makes running the business much easier. If the horizon to your first revenue is long and your business turnover to revenue (the time it takes to secure a piece of work and then get cash flow from the work) is also long, than you will need additional capital up front to fund operations (know as Operating Capital).
In the end, a good idea isn’t good enough to make the idea be successful. Ideally, to become an entrepreneur, many ideas need to be vetted and either discarded or pushed off until the timing is right. In general terms, if you are starting your first business, getting into a scalable service-oriented business is the best. As you labor in that first business, you can build up some equity that will fund your capital requirements for other businesses with higher capital requirements but higher absolute returns. This dance between low capital requirements with lower absolute returns to higher capital requirements with higher absolute returns is the path to becoming a successful serial entrepreneur, especially in the current business environment where credit is scarce.
While any entrepreneur wishes to make their environment the product of them rather then be what the environment produces, this is a macro versus micro conundrum.
Entrepreneurship is a creative endeavor. Keeping your eyes open for opportunity, where you can spot a need and enact to fill that need, takes creative power. This is about creating an enabling environment. This is micro.
To spot that opportunity it takes muses, other people. People to bounce ideas off of, executors who can enact the plan, and finally a market that will react. To impact on the macro scale, you need to create the proper micro environment.
Its balance, but with out courting the right environment to live in, you will inhibit your ability to explore opportunity to make something big. The real secret to the creation and realization process is the environment you are an actor in.
Invention: Wikipedia Offline
Type: Consumer Good
Summary: In the woods? Financial crisis collapses your society? Need to know something, anytime, anywhere? Add Wikipedia, a low power Kindle-type electronic paper screen, and a hand-crank power option and you have a knowledge source for anywhere in the world or for any age of the world.
Explanation: A handheld, ruggedized electronic paper based screen with a solid-state 16gig disk-drive, lithium ion or capacitor based power storage and multiple optional power inputs. Loaded on the 16gig drive is a complete copy of Wikipedia in a chosen language, less the comments and other extraneous dialogue. This copy of Wikipedia can be explored freely by the user via the electronic paper screen. The user can furthermore power the device via: Hand crank, AA batteries, AC or DC power. Finally, the device should be ruggedized such that it can handle drops, exposure to water, sunlight, sand and vibration.
Utility: A handheld compendium of human knowledge that can be used anywhere and that is durable so that it can last multiple lifetimes. Anyone who wields the Wikipedia Offline can teach themselves the collective skills of humanity.
With all of the crippling financial crisis out there, it makes me wonder when the right time to retreat to the woods and hunker down. But regardless, if you are a Greenie, this might be of interest:
The Peddle Powered Generator. Able to charge your laptop or run your TV on DC power. The idea is great, and even when combined with the capacity to send power back to the grid, it can make exercise lower your energy costs and lower your carbon footprint.
As promised, here are the Top 5 worst ideas in the 2008 Summer Sky Mall Catalogue. Welcome to an odyssey of suck. These are just the 5 Worst Ideas, several more articles could be written just on misleading or incorrectly advertised products.
#5: Indoor Dog Restroom 74967G
Maker: Hammacher Schlemmer
Why its terrible: My god. Dogs are not cats. Not only does this encourage dogs to take care of themselves indoors but it is also geared toward those too lazy to walk their dogs and take care of business. All around, this is a shit storm waiting to happen.
Why you would consider buying this Small dog, who is already very trainable.
#4: Lawn Aerator Sandals 126896G
Maker: Improvements
Why its terrible: Do you have a lawn? Unless you live in New York and have a 5 foot cube of grass, this is a stupid idea. Just pay someone to run their aerator over your lawn every two years.
Why you would buy this: If you have a tiny lawn, and feel you really need to aerate, maybe this could make sense. Still retarded.
#3: Aculife Therapist Deluxe TH366G
Maker: Gadget Universe
Why its terrible: Sky Mall is full of eastern medicine bullshit. Im not an acupuncturist but I’m going to go a head and say that this is complete blasphemy.
Why you would buy this: You have an agent, you have too much money or you like inflicting pain on your hand.
#2: World Phone 49MOBALPHONEG
Maker: Mobal Communications
Why its terrible: This looks like a terrible phone. For 50 dollars, I can get a first gen, world capable BlackBerry that will work in the states as a back up phone, in case my primary bites the dust. This phone? I got to pay $50 more for something that will work on our GSM network. Intolerable.
Why you would buy this: If you have no clue and are under extreme pressure to travel internationally. Never mind, there is no reason to buy this piece of shit.
#1: ACM Credit Card Wallet ACM104G
Maker: ACM Wallet
Why its terrible: This is a classic of the Sky Mall. Why would anyone who has money need ANOTHER wallet to keep just their credit cards. Either you have too many credit cards or you like shooting your card at the garcon.
Why you would buy this: None. Cancel half of your CCs and get yourself a real wallet. No one likes a credit card shooting dork.
Sky Mall: A bastion of innovation or get rich quick minor leagues? Lets take a look. Here are my Top 5 Best Ideas in the Summer 2008 catalogue (available on all of your NWA domestic flights). if you want to take a look at the actual item in question, go to the Sky Mall Search and enter the produce number.
#5: Extra Plush EZ Beds 22684G
Maker: Front Gate
Why its awesome: This is a great innovation on a very old concept: The airbed. Most airbeds are both inconvenient and uncomfortable. Historically, only the "compact" feature has been mastered. The EZ Bed has it all: Comes in a easy transport case. Built in compressor for both inflating and deflating the mattress. Elevated. This product has everything you could want in an airbed.
What could make it better: Not much. Weight is a concern, which is not listed in the ad. Plus, its probably a single chamber air mattress, which means its done if there is a leak.
#4: Table Top Photo Studio 73033G
Maker: Hammacher Schlemmer
Why its awesome: This is a classic invention of the times. Lots of Ebay’ers will buy this, even if its just a couple lights, screen, and crappy tripod. Just put together a package of complimentary goods and the added convenience will sell it self to the target market.
What could make it better: Offer a full sized version as well as the table-top sized. This will give you a higher margin product for the smaller market selling large items. Sell this on Ebay instead of Sky Mall. Its not a gift, but something an amateur Ebay’er buys himself.
#3: The 150-Country Travel Adapter 73365G
Maker: Hammacher Schlemmer
Why its awesome: Compact universal adapter for your AC devices with built in surge suppressor and a USB plug for charging your camera, Blackberry, or PDA? Holy smokes. This product is just about adding everything you could possibly need to charge your devices while traveling internationally. This is something I’d buy and recommend to others if they are planning to travel.
What could make it better: I have no idea. Maybe a AA battery charger? Also, if this covers 150 countries, what do the other 60 odd countries use?
#2: Edge Baking Pan 81606G
Maker: Solutions
Why its awesome: If you love the edge pieces of brownies, than this is essential. Not only does it add 3-edge pieces to your pan of brownies, but no other piece has less than 2-edges. Pure awesome.
What could make it better: Nothing, if you are a brownie edge lover and fancy creating a pan of brownies here and there, this is a must buy. Great gift for mom or anyone else who makes you brownies.
#1: MoGo Mouse N105-2002G
Maker: TigerDirect & CompUSA
Why its awesome: This is a mouse and presentation clicker that slides into your PCMCIA port for safe keeping and charging. Great duel use, definitely a need to be filled for any mobile warrior. Great product idea.
What could make it better: I’ve never tried one. My guess is that this is a great presentation clicker and a terrible mouse. The external Bluetooth USB adapter is lame. If my laptop needed the adapter (ie no built in Bluetooth) I wouldn’t buy this product.
So that’s the best of the best in the Sky Mall catalogue. Check in later this week for the Top 5 worst. Thats when it gets fun…
Invention: Governmental Liquidity Taker
Type: Organizational Convention
Summary: The trillion dollar hedge fund industry is moving towards systematic trading, predominately focused on short-term, high frequency trading strategies known as “statistical arbitrage.” The only good that these firms provide is liquidity and efficiency to electronic markets, which is an atleast 10s-of-billion dollar industry if not higher. These services should be provided by a 1st or 2nd party governmental entity.
Explanation: In order to provide liquidity and efficiency to the markets while refocusing financial markets on investing in commercial interests and not taking advantage of market discrepencies the government should take two steps. One) A goverment liquidity taker, run by the federal reserve, should be created. This firm will establish zero-risk, high frequency trading strategies both providing liquidity and efficiency while taking the alpha generated by the strategies and putting it back in the fed to either be retained or re-issued. Two) The government should move to put limits on holding periods so that other firms can not compete in the high frequency trading space. As little as a few second holding period should suffice in giving the governmental entity enough of an advantage such that only legitimate trading activity will be profitable.
Utility: The markets remain liquid and efficient while arbitrage generated funds are returned to the federal reserve for re-issueance or for building up the strength of the dollar benefiting the US financial system on the hold.
