I have been involved in business idea competitions since 2010 and more seriously in “Sharif Entrepreneurship and Business Development Festival” in the last two years as a judge, mentor, and lecturer on technology commercialization. In this post, I am going to discuss some facts that should be taken into consideration before submitting your idea to such competitions. Entering business idea competitions has some pros and cons for prospective entrepreneurs.
Pros
In addition to winning the competition’s prize, there are other benefits that one might gain by entering a business idea competition. First of all, idea competitions have a mentoring support, which helps the entrepreneurs better develop and optimize their business idea. So, having a free consultant at hand is invaluable for the prospective entrepreneurs. They can also use workshops and seminars that are provided and learn more about business startups, business plans, the pitch, and the whole commercialization process.
Testing the business idea is another benefit of competing in business competitions. The feedback from the competition also helps the prospective entrepreneurs correct their mistake or even drop the ideas that cannot succeed. I have always told that rejecting a business idea by investors or failure in the business idea competition is not a bad thing. This can be a preventer from opportunity traps that can ruin entrepreneur’s whole life.
Cons
It is not always a good idea to compete in business idea competitions, as there are also some disadvantages. One of the main problems occurs when you get popular before you are ready to bear that publicity. Getting popular sooner than you should, could be fatal and might cause you some new problems. You may see the “Made in China” version of your product before you start to scale up or even officially introduce the product to the market. Just by knowing some of your product’s main features this might get reverse engineered by some key players in the industry and as you know, they have already penetrated in the market. You should be really careful about your entrepreneurial intelligence and the decision between flying under the radars or revelation of your idea. This decision should be made strategically and is different for each business idea.
Publicity acts as a double-edged sword for entrepreneurs; on one hand, it supports the company by developing the company’s brand and publicizing the innovative idea, on the other hand, the key players in the industry are threatened to lose their customers. The giant key players in each industry are not easy to compete and soon there might be some critical challenges for the company. Nowadays, keeping the company’s secretes out of other industry players’ hands is not an easy task.
The Decision
It is crucial to know when to compete in the business competition and when not. As mentioned before, there should be a balance between revelation and innovation. The key point in submitting your business idea depends on two main factors. First, is the stage of your idea development (i.e. where you are right now), the second is innovation. It is not a good idea to compete when you have an idea, which is in its first stages of its development, because, you get a negative feedback from the jury and this might make you disappointed by having a feeling of failure. Moreover, revealing an idea before having enough power to implement and protect it might just alert the industry’s key players to follow the new innovative approach. Do not rely too much on patent registrations as protection of your idea. It is also possible to enter the competition and take all advantages of the competition and still keep the core of the business secret. In the recent Sharif festival this happened, and I was the mentor besides being member of jury, I encouraged two of the teams to keep the secret and just tell about the solution as a whole. After they won the trophy, a giant industry player asking for some sample products contacted one of them. When they asked me for advice, I strongly recommended them not to give any sample until they are ready for the market. Fortunately, this team got funded soon and is now ready for market entry.
In the cases with lower innovation degree, it is a good opportunity to test the business idea and learn the process of commercialization with the help of such idea competitions. Remember that these festivals also give you a great networking opportunity, in which you meet investors and other potential future business parents.