7Jan
Photo of three path options that lead to opportunity

How To Identify Good Business Opportunities

Photo of three path options that lead to opportunity

Why are some entrepreneurs better at identifying and capitalizing on lucrative business opportunities? Experience aside, I believe it’s because there are three very different types of entrepreneurs.

Success comes easily for some – it’s a struggle for others.

Type 1: The Naturals

Here’s where we roll the home run scene from one of my favorite movies of all time. “The Naturals” are rare, but they do exist. They were born with the innate ability to recognize opportunity.

Naturals experience success in multiple areas – both inside and outside of their comfort zone. As their notoriety grows, they’re presented with even better opportunities. I know, it sounds unfair! It kind of is.

Type 2: Pete and Repeat

This is another type of entrepreneur who seems to be able to recognize and capture success over and over again. “Pete and Repeat’s” last 5 business models were similar, and they were all successful to some degree.

Unlike “The Naturals,” P&Rs can’t always replicate success outside of the field they know. But they’re smart enough to recognize they need to stick with what works.

Type 3: The Simpletons

This is not meant to sound degrading. I would classify most entrepreneurs as “Simpletons.” They find success and failure in different types of businesses, and their opportunities are broad.

The problem is Simpletons feel they’ve had mediocre results. They wonder how other people became so successful. Well, there is a solution – it just takes some work.

5 Ways to Succeed

I recommend the following to help you recognize and capitalize on good opportunities:

Turn yourself into a “Pete and Repeat”
If you’ve had success doing something you enjoyed, do it again somewhere else. If not, find opportunities that might lead you into repetition. Since you aren’t a Natural, your best chance for continued success is to develop knowledge and experience that allows you to choose your opportunities wisely.

Invest time and money in people
Great ideas don’t go far if your time and money is invested in bad people and poor partners. Take the time to evaluate who you are getting into business with – the partners, customers, vendors and investors. If you have multiple opportunities, compare the people involved in each one. Who can you trust more? Who do you like more? Who will give you more time, effort and money?

Get in motion
You may make a bad decision or two, but you can learn from your mistakes. Embrace your failures, accept them, and move on. The next opportunity you jump on might be “The One”. So quit wasting time; get past the poor choices and move onto the good ones.

Partner with someone successful
If you’re choosing among several opportunities, pick an established business that offers partners with a proven track record. You might end up working with a Natural or a Pete and Repeat who can teach you how to make good decisions.

Consider the source
Some financially successful people are good at getting others to do the grunt work, and they don’t offer much in terms of time or money. These people simply want a “freebie.” If they present you with an idea or opportunity, do yourself a favor and pass on it.

I’d classify myself as a Simpleton. Sure, it’s a struggle sometimes. But success is so much sweeter when you’ve worked for it!

Which category do you fall into? What could a Natural or P&R teach you?

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About Alex Lawrence

Alex has been a successful entrepreneur for 20+ years. His current venture Lendio ranks #34 on the Inc. 500 list. Alex earned a BS degree at the University of Utah and his MBA at Weber State University, where he is Vice Provost and Director of the Entrepreneurship Program. If you want to talk with Alex about business and entrepreneurship (or other questions), email him (alex AT startupflavor DOT com), or you can find him on Twitter @_AlexLawrence.
  • Nate Durbano

    Great article Alex. Sometimes there is a lot of mystique about being an entrepreneur and you described it in a way anyone could understand. I just wish I could pick the type I fall into, I feel like I transition between all 3 types depending on the opportunity. Sometimes I pick up the opportunity immediately like a natural (even when its outside of my comfort zone), and other times I just don’t see it.
    P&R’s aren’t a bad way to go, but more for just cash cow income to subsidize the venture in me.

    I need to start posting more on your articles, I always find them very insightful and concise.

    Thanks for your efforts Alex.

    • Alex Lawrence

      Thanks Nate. I guess you don’t have to fall into one or the other necessarily, but there is definitely a trend I’d say. Analyze your entrepreneurial history and see what your trend is. I’d love your continued comments. Come back and share/question. Thanks Nate!

  • Agreed, this is a good blog. Keep it up.

    • Alex Lawrence

      Thanks John. I look forward to you sharing your thoughts and such as I post new articles and as others post comments.

  • Thanks for sharing these tips!
    I especially take to heart the recommendation to partner.
    Eric

    • Alex Lawrence

      You are welcome! Keep us posed with your progress.

  • jaro

    really encouraging,congrat for the nice work

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