How do you find these opportunities?

First, use your natural curiosity. Ask yourself why something is done that particular way. My first startup, Varitronic Systems, came about because Scott Drill and I asked why the only company (Kroy) in the lettering machine space, was still making users spin a dial to get the letters to print on the adhesive-backed tape..what if, we could attach a keyboard?…

Second, do the customers or users love the current service? If they don’t, there is room for another service or product opportunity. Said another way, if you not only find that they don’t love it, but HATE it…you are on your way to startup heaven. At JobDig, we simply took a look at the other employment weeklies in the marketplace, and found that only did employers not love the offerings, they could not even remember the name of the one they used.

Third, think value for money. There are businesses that are inherently susceptible to a creative entrepreneur who can dis-intermediate the offering, unless the business overhauls its business model completely. Obviously, most cannot. Basically, dis-intermediation means that you cut out the middleman or figure out a way to offer the same services for less money. I know real estate is going through this issue now, with companies like Zillow. Likewise, the contingency recruiter business, which finds its 25-33% of salary fee model under pressure today from companies like Dayak. But perhaps a future trend will be in the area of re-intermediation, where there is an undiscovered or under promoted value to the middleman who was eliminated. Levi’s started up a gi-normus website and then, closed it down. Another quick example: the GEEK SQUAD, a local computer service who would come to your home to help set up your computer. After Best Buy bought them, most think the services now are either too expensive ($350 for that?) or not customer-friendly.