Skip to main content

There might be a gap in the market, but is there a market in the gap?

I love this saying. As a (volunteer) business advisor I have met hundreds of people who believe they have an idea for a business. Programmes like Dragon's Den and get-rich-quick examples of the likes of the Youtube and Instagram founders encourage people to believe that the way out of their poverty (or simply to change from being an employee to an employer) is to start their own business. I did it several times myself and this blog is littered with tales of how I slowly, and usually painfully, eventually learned how to do it moderately successfully. It also contains here and there, ideas about how we might help start-ups avoid the pitfalls that await many of them.

The biggest mistake, in my view, is for a founder of a business to believe too strongly that they have a winner. This is counter-intuitive since passionate faith in your idea is usually the prerequisite advocated by every How-I-Made-My-Fortune book and entrepreneurial lecture or training course you'll find. These two things, passion and doubt, are not mutually exclusive. You can be passionate about an opportunity, indeed you need to be passionate about all your plans, but only if you are equally passionate about realising that you might be wrong! This means making sure that your idea makes sound business sense, and working hard to become your own devil's advocate.

For example, you might think there's a need for double (or half) length cigarettes. Some people may indeed like the idea and be prepared to buy them. But a huge raft of other factors might affect whether you can make any money out of the idea. These include: Legislation; Customised machine costs and impracticalities; Declining markets for toxic habits; People's long term experience of trying to use them (don't fit in pockets etc); Political pressure to prevent people liking them; Packaging; Shelf space; Distributor difficulties etc. So even if your idea 'tests' well on the high street, or wherever, there are many other reasons why the big companies investing billions in research and NPD (New Product Development) haven't launched the idea themselves. There simply isn't a market in that gap you identified. It's a gap for a reason.

On the other hand, big corporations can't cover every possibility. Coca Cola have long ago decided that the best people to innovate new products are 'the little man'. The legions of frustrated or desperate people in their bedrooms, kitchens and garages dreaming up ideas they naively (usually) think are going to make their fortune. 20 or so years ago Bill Gates was asked who he feared most, expecting him to say Oracle, AOL or maybe even Netscape (remember them?!). He said "a kid in a garage". It's where he and Jobs started, and prophetically it's pretty much where Page / Brin and Zuckerberg would emerge from. It's not just that they started small. It's that thousands, perhaps millions of Page / Brins and Zuckerbergs are beavering away in garages all over the planet. Like that famous ad for juice, "It's the fruit that Tropicana reject that make Tropicana the best". Pure Darwinian selection. Lots of experiments, and then if you can afford it, buy and propagate the survivors. Which is why Coke, Google, MS et al, buy much of their innovation rather than believing their own experts will have the answers. They might, but it's incredibly expensive if they don't. The vast majority of big corporation NPD budget is therefore invested in product enhancements as well as operational efficiencies rather than bold new ideas. What's going to be Apple's next big thing? In the final analysis, they have only ever had 1 product - a neat type of computer (of varying sizes, doing various but similar jobs). Everything they've ever done since the days of the first Mac have been machines to store and use digital information - although I will admit that iTunes is a separate success story (and one which ought to be smarter than it is and easier to use)... but you wouldn't use it if you didn't own an iJobs.

Once again my appeal to entrepreneurs everywhere is by all means dream big, but always test, test, test those ideas before you waste time, money, self-confidence, enthusiasm and energy. Knowing what NOT to do is the mark of a successful businessman.

BIG NEWS UPDATE. Since writing this post in 2013, I've started a social enterprise called, not surprisingly, Market in the Gap? Ltd (note I was allowed to register a company name containing a '?'). Details can be found at Basically it offers British start-ups a low cost market research package.


Popular posts from this blog

Phillips screws - yes I'm angry about them too

Don't get me wrong. They're a brilliant invention to assist automation and prevent screwdrivers from slipping off screw heads - damaging furniture, paintwork and fingers in the process. Interestingly they weren't invented by Mr Phillips at all, but by a John P Thompson who sold Mr P the idea after failing to commercialise it. Mr P, on the otherhand, quickly succeeded where Mr T had failed. Incredible isn't it. You don't just need a good idea, you need a great salesman and, more importantly, perfect timing to make a success out of something new. Actually, it would seem, he did two clever things (apart from buying the rights). He gave the invention to GM to trial. No-brainer #1. After it was adopted by the great GM, instead of trying to become their sole supplier of Phillips screws, he sold licenses to every other screw manufacturer in the world. A little of a lot is worth a great deal more than a lot of a little + vulnerability (watch out Apple!). My gromble is abo

Norman's Autobiography

The following is an unfinished autobiography written by my father who passed away earlier this week at the age of 93. Cheerbye Dad (you were the only person I knew to use this expression). You were a huge influence on my life. Thanks for taking the time to record so much that I never knew about your own life and those of our immigrant ancestors. Dad's the one in the middle ;-) The HorBraJacSac Saga by Norman Horwood  9th June 1926 (or possibly earlier!) - 27th June 2019 The Families' Backgrounds. We have four families; Abrahams/Horowitz/Horwood; Bralofsky/Braley; Jacobs and Tchaikofsky/Sacof. Taking my pair, the (Abrahams) Horowitzs/Horwood and the (Bralofskys) Braleys. They escaped from different parts of "Mittel Europe" at different times. Abraham and Rachel Abrahams, nee Gess, (Horowitz), had been in England longer than the Bralofskys, having come here from Lithuania in about 1897 as a married couple without children. It is certain that Abraham

Prepare for Alien Contact

I've not gone barking mad or joined some weird religious cult (aren't they all?). But I do predict that we will make contact with intelligences from other planets soon. Here's my reasoning: There are approximately 100,000,000,000 stars in our galaxy (easy way to remember this order of magnitude is it's one hundred, thousand, million). Usefully there are also approximately the same number of galaxies in the universe. And assuming every star has about the same number of planets orbiting it as our Sun, and that the Milky Way is an average size of galaxy, that means there are around 100,000,000,000,000,000,000,000 planets in the universe. A lot. Scientists have long debated the probability of life, as we would recognise it - reproducing, eating, etc - existing outside Earth. Most agree mathematically that it's a certainty. What they did was take all the components they believed were required for life to have evolved on Earth and then extrapolate what they know about