From now on I will value each idea at $1.
Everyone has cooked up an idea for that thing that’s going to take over the world. I mentioned a few of them over at The Idiotic Idea. I reckon I personally cook up at least two per week. Where things get skewed is when the idea in itself is valued so highly by the person who cooked up the idea.
I’ve seen the story play out a few times around me. The idea is presented. The back of a napkin multi million dollar revenues are projected. Super high margins. Fair and equitable split of shares (of course the guy with the idea always holds a big piece of the pie) and then reality kicks in. The ideas man has nothing more to offer than the idea and then everyone else is expected to bow to the self appointed CEO and throw in a tonne of sweat equity.
Ideas are important. But not just ‘the idea’. Put some bones on the idea. Think it through. Plan a little. Do some research. And don’t insult your potential partners by deciding up front that the idea is worth 30%, 51%, 80%. It’s bullshit equity. Accept it for what it’s worth. $1. And then work like crazy with your new partners to build a great big shiny cashed up solid business.
Erz Imam owns 100% of 3 ideas. Tomorrow he plans to cook up a new idea, giving him just enough to cash in the idea and buy a coffee.