If you've done any research into what makes a strong startup, you probably know that it all begins with a strong startup idea.
But how do you if you're idea has the potential to become an enduring startup?
Through validation, of course!
Now, validating a startup idea is a long an intensive process. However, this installment of our Startup Checklist outlines everything you need to ensure that your idea has what it takes to become a successful company.
1. Define Your Startup Idea
1. List your interests, hobbies, passions, interests, etc. - anything that you have more than a general insight in. Start with general areas (music, sports, tech, health and fitness, etc.), then focus on more specific topics.
2. Outline the problems that you see in the world, as well as those you encounter in your daily routine. What are the biggest inconveniences you encounter in your life? Do others have this same problem, as well?
3. List out the details of your profession, previous career, or field of study. What are some of the technical aspects that most people aren’t familiar with? Can they be streamlined or improved upon?
4. Once you’ve outlined specific areas of focus from the previous exercises, write down as many potential startup ideas as you can from them. Don’t worry about practicality or originality, as the goal is to merely kickstart your creativity.
5. Look over all of your startup ideas, and home in on the three best ideas in order of their potential, as these will form the basis of your initial research. (Be sure to keep the other ideas on hand, in case these three ideas don’t pan out.)
2. Determine What Your Customers' Problems Are
1. Translate your three potential startup ideas into customer problems that you will try to solve with your future company. For example:
- If your startup idea is “an entrepreneur training and startup launch program”, turn it into something like “an institution that will help people who want to start companies but don’t know where to begin”.
2. For each idea you come up with, identify the type of customer you think would be most willing to pay for your idea, whether it’s an app, software, hardware, service, or something else entirely.
3. Then, identify the problem that your idea solves for this customer that they can’t find convenient or reasonably priced solutions to. Right now, tour primary goal is to find a real problem that people urgently want to have solved and are willing to pay money for.
4. Next, write at a one sentence description for each customer problem using our Startup Madlibs format, which can be found here. This format is ideal for beginning founders, as it forces you to clearly and simply state what your idea is, the problem it solves, and who it’s for.
3. List Your Qualifications for Solving Your Customers’ Problems
1. List out all of your professional experience and skills from all of your jobs, both current and previous. Be as specific and in-depth as possible, and don’t be afraid to be overly technical, as this is primarily for your own purpose.
2. List out all of your educational experience. This can include formal education, like high school, college, master’s and graduate programs, etc, as well as other educational programs you may have participated in, like trade schools, online programs, certifications, etc.
3. List out all of your other skills and abilities, regardless of how trivial or unorthodox they may seem; again, like the previous examples in this section, this for your own private use. For example, you might include guitar playing, photography, juggling, cooking, rock climbing, or any other artistic, intellectual, or athletic skill.
4. Now, go through your previous answers and answer the following question:
Why am I qualified to solve this problem?
List as many reasons as to why you think you’re the best person to launch this company. The more answers you come up with, the more qualified you are to be an entrepreneur.
4. Conduct Initial Customer Interviews
1. For each potential customer problem you come up with, identify at least five people who are familiar with the problem, or, even better, may be prospective customers themselves. You should have at least fifteen people to converse with, but ideally many more.
2. Create a list of questions to ask each person about each problem. And no cheating! Each problem should have its own set of unique questions. The more specific and in-depth you questions, the better the feedback you will receive.
3. For each individual you interview, write their name and provide a bulleted list of their feedback and insights. And easy and free way to manage your contact list is to input this information into a Google spreadsheet.
4. You may want to re-interview people in the coming weeks as you continue to refine your ideas, so be sure to ask them if you can follow-up with more questions in the future. And always be on the lookout for more people to interview.
5. Identify Your Lead Customers
1. Evaluate the feedback you received from the initial customer interviews you carried out, and examine what kind of customer showed the strongest need and most willingness to pay for your proposed solution. The people who demonstrated the most interest in your idea are the ones that are most likely to become customers in the future.
2. For each customer problem you listed, write a series of bullet points that describes the individuals that showed the most interest in your solution and identify what they were specifically interested in. Was it the ease of use of your offering? Was it the price point? Was it the convenience? Was it the uniqueness? Or was it something else entirely? Be as specific as possible.
3. Once you’ve clearly identified all of the features that your potential customers enjoyed most about your offering, list out all of the features they didn’t like. Was it the lack of useful capabilities? Did they think your offering was too expensive? Is there already another product or service out there that does something similar to your offering?
- This is also a great way to learn how to take criticism of your offering, so don’t be offended if someone hates an aspect of your idea that you love, as others may feel the same way.
6. Extensively Research Your Market
1. To further validate your startup idea, you need to have considerable knowledge of your chosen market. Start by writing a bulleted list of at least ten keywords (preferably more) that can be used to find news about your market and competitors.
2. Use these keywords to search on multiple search engines and app stores, as well as startup- and business-related websites like AngelList, CrunchBase, Linkedin, and other distribution or discovery platforms to see who and what is out there.
3. Create a bulleted list of the ten most interesting resources that you have discovered for that are related to you customer problem, which may include blogs, thought leaders, industry luminaries, research organizations, or partners.
4. Catalogue all of your findings in a spreadsheet, including the following details:
- Market Name (example: “Travel”)
- Segment Name (example: “Online Recommendations”)
- Addressable Market Name: (example: “$4.1 Trillion”)
- Market Size: (example: “$4.1 Trillion”)
- Segment Size (example: “$313 Billion”)
- Addressable Market Size: (example: “$2.1 Billion”)
- Competitors: (example: “Travel A, Co.; Travel B, Co.; Travel C, Co. etc.”)
Do this for every customer problem you’ve come up with so far. This will require a lot of work, but this will give you the opportunity to identify the market that has the most potential for growth.
Final Thoughts
While you'll need more than just an idea to build a startup, there's no denying that having a strong concept for a product, service or other offering will help you lay the foundating for a lasting company. And don't be afraid to get inspired from strange sources, so constantly be on the lookout for a great idea. As Peter F. Drucker once said,
If you want something new, you have to stop doing something old.
Get even more feedback on your idea by going to a free startup event near you!
Copyright: Image by StockUnlimited
