ask questions to validate your startup by taking actions

“if you wait for the perfect condition, you’ll never get anything done” – Eccl. 4:11

Life is full of uncertainties.

You can’t be 100% certain that your next action is a good idea; at the same time, you can’t wait without taking an action. This uncertainty is a big challenge to startup founders-to-be. To them, the big question is:

“How do I know that my startup idea will succeed before investing too much into it?”

That is the question you want to ask before you pursue your next startup idea, otherwise, you might end up totally exhausted with a failed startup to show for the time spent.

What’s The Ultimate Secret That Determines if A Startup Will Succeed?

The first step is to realize that 80% of the time, when startups fail, it has nothing to do with the passion of the entrepreneur or the product itself; it has everything to do with something else I will share with you in a minute, later in the post. Yet startup founders don’t get this, that is why they get carried away with product development and fall in love too much with their startup idea to the extent that they easily fantasize about how it is the next best thing after slice bread.

Then they fail.

The reason they failed is not because the product was badly designed, the reason, as captured by this Quora answer that they are trying to push their product down the throat of customers. This image captured that reality.

A Non-technical guide TO VALIDATE if your startup idea is a viable business 2

Ready for the secret?

80% of what determines your success is your customer falling in love with and using your product, but before your customers will fall head over heel for your product it must solve their problems. Think of your idea as a solution to a problem and here a 3 critical questions to help you decide if you should pursue your next startup idea

1. How many people want this product? (market size)

2. Will they spend enough on the product that I can start a meaningful business? (profitability)

3. Can I develop a dead simple system to convert them to customers, at profit? (business process and system)

The 5 Layers of Your Startup.

Do you remember the Maslow’s hierarchy of needs? There is a variation for startup; it looks like this.

startup-pivot-pyramid

Customers. They are the foundation of your startup. The problem you solve, the product you build and the technology you will build it with all depends on who your customer is.

Problem. Are you solving the right problem for your customers?

Solution. After identifying the problem that matters to your customers (I will show you how to do this later), you will need to build a product better than existing market solutions.

Technology. Your technology is a means to build out your solution. Your customer determines your choice of technology stack.

Growth. After product market fit, this is how you give your startup traction.

It is important to know how this all tie up so you know what area to focus on next. At the idea stage; you should be more concerned about the customers >>problems >> solutions. Decisions about your choice of technology and growth plans depend on the first 3.

In order to get you unstuck in each stage of your startup, I will recommend following my 3 non-technical road map to startup validation.

My Non-technical Roadmap To Startup Validation.

Here are my 3 dead-simple roadmaps you can follow to launch a startup idea that you are sure will potentially be a market success.

Roadmap 1: “Reverse-engineer” your success.

Instead of thinking first about your product, you should reverse-engineer using a “Problem versus Solution” approach. This approaches focuses on finding out what problems your customer have (i.e what they complain about) and how your idea solves that problem.

Let’s assume that the problem your new startup aims to solve is recruitment challenges for HR of startup companies. Instead of writing lines of code on GitHub or Heroku app, you should do this first:

“search for what HR professionals complain about as it regards recruiting top talents”

You can do this on Google, online forums, groups (on Facebook, reddit or other social networks), or Quora.

(For example, my search on Quora showed this result)

Quora search on how to validate startup ideas

When I did a similar search on Google, I got a stream of answers which are mostly links to articles. I read some of them which gave me clues of the ACTUAL challenges HRs are facing. You can still dig through the related search queries under your result page to get more ideas. (like the image below)

more searches 2

A second part of the search is to identify existing apps/websites that offer the solution. I also recommend taking a shortcut by looking for other existing startups in that space. (You can lookup this startup idea Vault )

From the Google result, one of them is Workable.com. To go more further you can search for similar websites like Workable.com by using SimilarWeb or searching Google with the term “alternative to {insert website}”

alternative to workable.com

Don’t forget; I am not in a hurry to write a line of code until I know that there is a market for this idea. Hence, the next step is to do a breakdown of all the websites identified in the research. By analyzing 3 – 5 websites, common themes will begin to emerge. This knowledge will help to develop MVP ideas that address the CORE problem of the market. In addition to the solutions that each existing websites offer, I am also interested to know what keywords they are ranking for. The keyword they are ranking for indicates the term that the customer is using to describe their needs. You can use free tools like SimilarWeb or Alexa to know what keyword a site is ranking for as well as the demography of its users. (Like this )

workable keyword 1

You can also run the individual (organic and paid) keywords of each of the site; as analyzed by Similarweb through Google’s Keyword planner to gather more insights. To get more stealth in your research and take advantage of the research of others to your advantage, you can follow this guideline

After completing this exercise, you’ll have created:

1. A list of problems that your target customers want to solve (some will be the main problems while others will be minor)

2. A list of ideas that others have implemented.

These will help you to come up with your own unique angle to position your own startup (to understand what I mean by angle, you can read about how PushCV positioned itself as a discovery platform for pre-screened job applicants instead of a job board)

So what should you do next with the research?

Paradigm 2: Challenge your assumptions with a MARKET TEST.

Now that your idea has been given a form, you might be tempted to build a prototype immediately. But not yet. Before you build a prototype, you should validate your assumptions by setting up a landing page. That way you can gauge the interest of people interested in your product.

On your landing page, you should use the keyword from your earlier research to list out the benefits of your proposed MVP; not just the features and include a simple call to action to “sign up” (see some ideas )

A bigger commitment is to include a pre-order form, as your goal at the early stage is to get your users’ commitment to the product (and even pay for it before you build it) so that you do not launch to crickets. You’ll notice that there is a difference between when someone says he is interested and when he is ready to swipe his credit card. Hence, pre-orders are a solid sign of customer commitment. This was the exact formular that Bone Broth used to launch his broth business.

Noah Kagan has a classic approach to quickly verifying if he can make a $1000 in 24hours with his prototype idea before he builds it. He explains it in this interview with Pat Flynn.

You can watch a longer version in another interview with Tim Ferris of 4Hour Work Week.

Another subtle way of validating your startup idea is CROWDFUNDING. It is easy to think that crowd funding is just about raising money for your startup. However, it is more than that: it actually helps you to gain exposure early and most importantly pre-sell your product to interested buyers. Take the case of this kickstarter campaign with the goal to raise $200,000. They subtly gauged market interest by indicating that the product would not be launched if their $200k launch target was not met. To them, reaching the campaign target was an indication of a market need for their product.

To quickly drive traffic to your landing page, you can appropriate a $50 – $100 budget for Google Adword or Facebook Ad campaign to drive traffic to the page.

Paradigm 3: Have a system to accelerate learning: not revenue

You want to learn as much as possible about your market and product in its early days. That is why you should prioritize learning above revenue. For example, getting feedback early can help you avoid creating a product or service that nobody really wants. You can use survey tools like quolaroo, jotform, google forms and survey monkey and several others. But nothing is better than hanging out with at least 3 potential users of your product over a cup of coffee to elicit valuable feedbacks.

Feedback from surveys have helped companies decide how to better position their startups (customer testimonials are powerful for this); how to choose the best pricing and sometimes the best business model to work on. You should develop a framework and build system to make user feedback an important part of your startup validation.

One More Thing…

Do you have a friend who may be considering a side hustle, is out of job or want to leave her job to launch a new business? They could be apprehensive about which project to commit their resources to as they are yet to validate their ideas.  Share this post with them and let me know what they think.

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