Choosing the Best Business Idea

• Be certain you have a high profit margin. There are very few companies that can compete long term on a "we are cheaper" marketing platform. In any new business, you need to watch your cash flow -- and if you're trying to work with low profit margins and make gains in volume, you'll need to have a high level of working capital to keep you running through the lean profits early on. Having a higher margin is extremely important when you're growing a business so you can self-finance your growth.

• Build a strong support team because a good idea isn't enough. The idea counts most, yet a quality idea must still have a great team of people behind it to give it wings. Time after time, when people bring me a business investment proposal or an idea they want to take to market, I ask them who's on their team and they respond with something crazy like, "Oh, we haven't hired anyone yet." Get a board of advisors. Get a team of professional accountants, coaches, lawyers and bankers. A great team will greatly improve the chances for success of any business.

So if I were going into business today, what would I choose? I would start with one premise and some hot industries. The premise is, you don't make money panning for gold, you make money selling pans. Get in the way of a buying frenzy, and you'll be a success. The fastest way to make a restaurant profitable is not by having a great chef and great décor -- it's by attracting a starving crowd with money.

Once you understand this, the question is, which industries are gold rushes right now? With an aging population, health and leisure are growing industry segments. And professional advice is at an all-time high in many fields. Or as an alternative, you may want to look at my old favorite -- staple products and services, think paper or plumbing, you can deliver just a little bit better than the competition.

One last point: Start with the end in mind. Look for an idea you can take national or, even better, global at some stage. It might be fun and a challenge to establish yourself locally right now, but eventually you'll want to build something much bigger.