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 The difference between an idea and an opportunity

 What makes a great opportunity?

 The nature of competitive advantage and distinctive competencies

You’re a brand-new entrepreneur who has a big idea and a boatload of passion. You wanted to start your first million-dollar business yesterday, because you know your idea is so big that it will thrill your customers and fulfill your dreams in the process. The first question you have: how much is this idea worth?

Nothing.

Ideas are numerous, and they exist without inherent value. An idea—no matter how big or small—is a series of electrochemical reactions inside your brain. No one purchases ideas, and ideas cannot be assigned a dollar value. This does not mean that ideas are without potential—ideas are critical first steps toward developing opportunities. Unlike ideas, opportunities are the stock and trade of successful entrepreneurs. Opportunities are actionable, and they have the potential to provide value both to customers and to you. The distinction might seem subtle, but the difference between an idea and an opportunity is a critical one. Attempting to follow through with ideas that have not become opportunities will spell disaster for your venture. It will be doomed before it even begins.

Ideas and opportunities do not exist independently of one another, and they do not exist independently of people. Everything that has been created by people started out as an idea, but not everything that has been an idea has been created. This is the root of the value assigned to opportunities: execution. Opportunities are valuable in their execution. Just as an idea that is trapped in your head has no value on its own, an opportunity that cannot be executed has no value either.

There is no such thing as a new idea. It is impossible. We simply take a lot of old ideas and put them into a sort of mental kaleidoscope. We give them a turn and they make new and curious combinations. We keep on turning and making new combinations indefinitely; but they are the same old pieces of colored glass that have been in use through all the ages.

– MARK TWAIN

Mr. Twain was correct. There are no new ideas. Every business idea is a permutation of existing ideas and conditions. Whether or not an idea can be evolved into an opportunity determines whether it will become reality, or whether it will just be another series of electrochemical reactions.