What’s Your Idea Worth?
This is Website.co.uk and I’m Adrian and This is what’s your idea worth. if you want a million-dollar room billion-dollar business here is my guide how to get it and why really metrics of what a business is worth today in the digital economy is very very different. And before you say anything, I know in the UK and we should use pounds but billion dollars sounds much better than a billion pounds.
So by definition of an idea to me it’s a feeling, it’s a feeling that an item or action when planned and executed will achieve a desired outcome. What about coming up with an idea? Well while naturally you do this every day and the more you consciously apply yourself to doing this the better you get at it.
The value, the are no simple rules but here’s how I see things: i just so as I say it now valuations are subjective and can never and I mean never be an exact science so don’t hold me accountable if you are given a different value that doesn’t follow my guide. So, what’s a bad idea worth? To me, it’s worth nothing. What about a basic idea? Well it’s worth very little, in fact it’s worth very little to most so let’s call it a pound.
An average idea, it’s worth something but only a fiver. What about a good idea, well a good idea’s got to be worth something, well to me, it’s worth 10 pounds.
What about a great idea? Great idea it’s worth money but still only 15 pounds well what about a wow idea, well this is something worth taking seriously but it still has a very low value, only 20 pounds.
As you can see the value of an idea is extremely low and it’s not going to make you rich and famous overnight, no matter what anybody tells you. But, there is a way to turn very little in to fame, fortune and notoriety; here’s how, the sums and how I think about it.
Step 1 is what i call the business stage. Depending on where you are on the delivery curve there are multipliers you can use on the initial idea value. So, just to give you an idea, if you just thought about the idea, I use the multiple of one. If you’ve started but have no income, no matter what you spend getting to that point, the multiple value is two.
If you started selling and actually have an income the multiple value is 3. If you started making profit and have been doing that now for six or more months the multiple value is 4 and then if you’ve made profit, and I mean profit for over 18 months then use the multiple value of 5.
So, here’s a but of maths for you : It’s the ideal value times by the stage multiplier equals the total value. For example an average idea of 5 pounds times six months plus of profits thats four is a total value of 20. A great idea is 15 pounds times 18 months of profit multiplier of five giving you seventy five and a wow idea valued at 20 pounds and six months plus profit giving you a four time multiplier so that’s a total of 80 pounds.
But therese are still low values, yes. But there is a way to totally change this, even with just an OK idea. So now, step 2 or what I call the execution and execution is really critical because when you deliver something it’s the way you deliver it that creates real value.
So, if you’ve not executed anything or you haven’t done anything yet the execution value i’d put at a hundred pounds. If you have but it’s quite a weak execution, really not that effective but it’s working, the value’s a thousand. If you’ve got an average quality execution that value can go up to 5 thousand pounds.
If you’ve got a good execution and plan then we’re talking about 10,000 pounds as an execution value. If you’ve got great execution this can rise to 50000 pounds if you have amazing execution then it’s got a value of a hundred thousand pounds.
And then, the holy grail is really the complete execution and it’s actually very difficult to put a value on here but I’ve got it as a million pounds plus, a complete execution is quite a complicated thing we really don’t have time for this video to go over it but it’s really the sort of thing that the big dot coms sell for millions and millions if not billions of dollars have achieved.
So, let’s look at the maths this way, we’ve now got the idea times by the stage times by the execution, think of it as our final value. And now you’ll start to see why things are worth a lot of money in the digital economy. So your okay idea and 6 months profit with weak execution is valued at 20,000.
But if you’ve got a great idea and 18 months of worth profit and great execution, all of a sudden it’s 3,750,000 but what about a wow idea well this is quite interesting because a wow idea may only start as a 20 pound value but if it’s going for 6 months and shows profit or potential profit for 6 months plus and it’s completely executed all of a sudden you’ve got an 80 million pound value.
And it’s really important to see that this is what works for the big dot coms. So, what does it all mean? Well, the value is in the execution, not the idea or the stage of business and the faster you execute things well the more value you add to your idea or business.
It’s why services like Instagram get valued at $1 Billion. So, it also means that products and services that are well executed will always do better than superior ideas that are not as well executed, which actually, when you look at it is very true. So, how can I add value? Well there are many elements that determine the quality of execution, especially, in my opinion, the marketing.
So, what to do next? Get a plan together then get help and support with that plan and the execution of it fast. And don’t forget, use website.co.uk as a source of inspiration, advice and support to help maximise the value of your idea.
We always have people ask us what do we use on this site, so here are a few of the most relevant service providers:
- To manage our audience and email communication we use: Infusionsoft
- For most of our images, we use: Shutterstock
- Our web hosting and domain registration is done by: 123-reg and Realhosts.
- To automated and centralise our social media we use: HootSuite
- To help with SEO and lead generation we use: Webfire
- Video on this website is hosted on: Wistia
If you would like to find out more about any of the providers listed above, we review them honestly, provide details of alternatives (as they may be more suitable for you) and also other services we use in our resources section.