Have you ever envied an experienced entrepreneur’s ability to spot great business opportunities while going about something mundane, like grocery shopping or running errands?
What makes them so good at spotting trends and how can you develop an eye for the same?
Here are 8 methods I’ve learned from many exceptional entrepreneurs I’ve talked to over the years on how to spot trends:
1. Talk to teenagers. Whether it's via online forums, WhatsApp groups, or siblings or nephews, observe these kids and their content consumption and entertainment habits. They're consuming memes and media you're likely not exposed to, and speaking in ways that sound foreign. What they care about today, will soon bubble into something larger tomorrow. Video games, when they were first released, were deemed to be trivial. But today, they’ve grown into a multi-billion dollar industry.
2. Browse Product Hunt, Kickstarter and Indiegogo for massively upvoted or funded projects. What this reveals are concepts, products or services, which don't exist in the market, but people are dying for.
3. What is something people hate doing but they do it anyway? Why are they doing that? Is there a better way?
4. What do your friends do that you find surprising? Early morning running, multiple locks in-house, therapy, spending a tonne on gyms and health food subscriptions. Why is it surprising? And is this behaviour more mainstream than you think?
5. What are companies posting on their job boards? Oftentimes roadmaps are exposed for free, for all. What's about to be built, but not known, is frequently revealed.
6. What are people doing in spite of governments not allowing it? Avoiding taxes, buying drugs, speaking freely. What are motivations for those behaviors? How would you solve for these motivations legally?
7. What generates complaints? Where is there pain and annoyance? Where does the pain point seem to be compounding on itself?
For example, we know the cost of university tuition has been skyrocketing while the value of a college degree in the market has remained stagnant. The price of university tuition is not going down any time soon. So, pressure is building underneath the surface.
There are huge incentives on the demand side for that problem to be solved. That means that society might be more open to solutions now than ever before. Timing is key, but usually one big upheaval, like a pandemic, is enough to usher in a better solution.
8. What will acquire more scarcity value and pricing power as the price of a product drops?
For example, if content is abundant, curation becomes a scarce resource. If sensors to collect data are abundant, data analysis becomes a scarce resource.
Observation is key. Curiosity about human behaviour and motivation is key. Whenever you see needless friction, ask yourself if eliminating that would be widely appreciated, and hence, be a good business opportunity.