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Home > Entrepreneurship, My Thoughts, Start Up, Strategy, Venture Capital > X For Y: Try This Business Formula To Start Up

X For Y: Try This Business Formula To Start Up


Ever heard of an OKCupid for dogs? Or a LinkedIn for pets? Surprised? Don’t be, because I have heard about a start-up pitching itself as the LinkedIn for pets. There have been many successful start-ups that started as X for Y and then evolved their business model as they grew.

I am not a strong supporter of entrepreneurs pitching their ventures as X for Y as it kills the sense of innovation and originality, and creates more of a copycat or me-too feeling. Having said that and no more on the pitching part, the X for Y formula still holds water when it comes to presenting new business ideas and giving a sense of direction to new initiatives.

So how does one leverage this formula? There are two ways of doing it when you want to develop your own business idea. In the first case, take a small part out of a bigger business plan and create a niche around it. Out of a large customer base, try to target a segment with slightly different (or special) needs and build a service or product around these needs.

For example, OLX.in allows posting ads for almost everything under the sun. But there might be a specific set of customers with slightly different needs. For instance, there could be people who want to sell or buy antiques. Therefore, one can create a platform for posting ads to sell or buy these collectibles. Now what we have is a business idea that can be called OLX for antiques. Once the core is in place, the bells and whistles can be added as per customer requirements and additional features can be developed, depending on early adopters’ response.

The second way is to start a parallel business. If there is an existing venture providing a service to a certain set of customers and one feels that there is another service that can be provided to the same set or a different set of customers, the solution is to create a ‘parallel’ business. Zomato, as we know it, is a review and rating platform for restaurants. A similar start-up can be a platform for reviewing and rating some other service providers. In fact, there is a start-up in India that rates private coaching institutes. So, here is an opportunity to start a Zomato for X, Y or Z.

Before we overestimate the power of X for Y, I want to end on a note of caution. The X for Y formula should not be expected to churn out new business ideas. This is not as good or as easy as it sounds. Had it been so, generating business ideas would have been much easier than it is today.

I find this formula to be more of an idea ‘incubator’ rather than an idea ‘generator.’ This means, it can more effectively help one incubate and grow an existing thought in a new space instead of generating a totally new business concept. Still, go ahead and try it out.

 

[This article has been published online by Business Insider]

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