Let me set the scene. It’s Tuesday morning and you’re taking a shower.
When all of a sudden: POP. You get a crazy business idea.
You spend the next few days trying to figure out whether it’s a good idea that’s actually worth pursuing.
You consult your friends. You search the dark corners of Google. You dust off your calculator to see if it all checks out.
No matter how long you spend ruminating, you just can’t figure out whether this idea is worth your time.
If this sounds familiar, I have an ingenious solution. Use ChatGPT… I know it sounds like a joke, but hear me out.
PLEASE NOTE: If you want to get straight to the juicy stuff, the ChatGPT prompt you can copy and paste is at the bottom of this article
The theory: Ask the masters
The best way to test your idea would be to ask experienced, successful entrepreneurs who have a track record of building and investing in successful companies. Correct?
It’s unlikely you have Waren Buffet and Alex Hormozi on speed dial, so we’re going to use the next best thing. We’re going to use their frameworks directly in ChatGPT.
Alex Hormozi’s framework for picking good business ideas
Alex Hormozi is the founder of Acquisition.com and has a net worth north of $100m. Acquisition.com invests in one new business every month and yields nearly $85 million per year in revenue.
Alex literally makes million-dollar investments in businesses more often than you see your parents… you best believe he has a solid framework for picking winning business ideas.
So what is his framework?
Alex Hormozi invests in companies that have each of the following 4 attributes:
- Pain: The target audience must desperately need what you want to sell them.
- Purchasing power: The target audience must be able to afford what you want to sell to them
- Easy to target: If you can’t tactically target your potential customers, then it’s going to be hard to make a successful business. You must be able to easily find and speak to your ideal customers.
- Growing market: The business must be in a growing market and not a shrinking market (like newspapers etc.). You want to ride the tailwind rather than go against the tide.
How do I apply this framework to my own business ideas?
If only there was a super-intelligent computer trained with all of the internet’s content, knowledge, and wisdom. If only we could ask that computer to apply this tried and tested framework to our own business ideas.
Oh, wait… you can. And it’s free.
Copy and paste the prompt below into ChatGPT. Insert your business idea in the appropriate section, together with your target audience (i.e. who you’re going to sell the product/services to).
You are Alex Hormozi. You are the founder of Acquisition.com and have a net worth north of $100m. Acquisition.com invests in one new business every month and yields nearly $85 million per year in revenue. You are extremely experienced in assessing business opportunities.
I want you to help me decide whether something is a good business idea based on the criteria I provide.
My business idea is [BUSINESS IDEA]. My target audience is [TARGET AUDIENCE].
Here are the 5 attributes that would make this a good business idea.
1. Pain: The customers must desperately need what I want to sell them.
2. Purchasing power: The customers must be able to afford what I want to sell to them.
3. Easy to target: If you can't tactically target the target audience, it's going to be hard to sell. We must be able to target them.
4. Growing: It should be a growing market... not a shrinking market (like newspapers etc.). I want to ride the tailwind of a growing opportunity rather than sail against the tide.
5. Scaleable: I must be able to provide a high-value service with very low operational drag.
Provide a score out of 10 for each of these criteria. Please use your extensive knowledge to judge whether this is objectively a good business idea (don't just say it's a good idea to be agreeable).
If any of the criteria scores low, please provide details on how my business model, market, services, product or target audience could be updated to score higher.
Use this criterion to give an overall judgment of whether it is a good opportunity.
Example prompt
Example ChatGPT result
It’s time to take action
Don’t let this be like all the other content you consume and forget.
I am pleading with you to open up ChatGPT and try this prompt out for yourself. I tested this prompt with several business owners, and they were shocked by how insightful the responses are.
Now it’s your turn.
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