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What are the three basic types of startup ideas?

Longenecker et al. (2020) identify three basic startup idea types: Ideas to enter new markets, ideas based on new technologies, and ideas that offer new benefits (p. 43). Similarly, these categories in essence represent the starting point for any new business, while each focuses on different drivers. With the new market concept, a business seeks to bring an existing product or service to an untapped consumer base, such as playing live music at nursing homes that dont have performers. Alternately, the new technology concept involves creating a brand new product or service, like building a website that matches musicians with gigs. In contrast, the new benefit concept involves using existing products or services for a new purpose. For example, making decorations out of old instruments would be a new benefit. It is important to identify what type of startup idea it is early on to better plan for the road ahead.

What are the most common sources of inspiration for startup ideas?

While the sources for startup ideas are limitless, Longenecker et al. (2020) describe the three most common: Personal/work experience, hobbies and personal interests, and accidental discovery (p. 44). Predominantly, personal and work experiences have been the basis for many startup ideas, with 45% of participates in a National Federation of Independent Business survey naming it (p.44). This makes sense since people recognize the need for a product or service firsthand will then fill the void. The second place answer was personal interest and hobbies. Again, firsthand knowledge with how a pastime can be improved can lead to a business idea. The third place answer was chance happenings, which is another way of saying a happy accident. For example, someone who repairs sofa cushions learns there arent a lot of places that offer sailboat upholstery services, which potentially requires the same skills and pays more. Regardless of the origins of ones startup inspiration, once pinpointed, it has the potential to grow into a successful business venture.