Have you ever wondered how entrepreneurs of successful startups like eKar, Postpay, Sarwa, SunkambeMusic, Vula Mobile, etc got their idea and asked yourself, “how do I get an idea for a startup?”
Well, startup ideas are usually a moment of inspiration, or reflection on a problem. It can also be from frustration in getting a task done or from having technical knowledge which can be applied in a new way to solve an existing problem. So, startup ideas arise from a problem and the entrepreneur starts a business to provide a solution.
So what happens after you have a brilliant idea? Should you jump on the startup bandwagon right away? Hold on, having an idea is great but starting a startup without validating it is not. So what is idea validation? Let’s know more.
What is Idea Validation?
Validation is a process of collecting data and other important information to determine if your idea is valid, market-ready, and usable. So what makes an idea usable and market-ready? Well, there are some general indicators to assess an idea.
- Your idea solves a unique problem.
- There’s a market demand that exists around the proposed product or service.
- There is competition but the market is not saturated with many players vouching for attention.
- People are willing to pay money for it.
Startup Idea Validation – The Process
Startup idea validation involves assessing validity at four stages: the problem, market, product/service, and customer willingness to pay. Entrepreneurs can use this simple framework to get their idea validated.
Validating The Problem
Is your idea solving a problem that consumers are facing? Let’s find out. There are three basic methods to use to validate the problem. The main idea is to ensure you’ve got a real problem to solve.
- Find people who would be interested in your product/service – Identify at least 10 of them who fit your buyer personas. For example – If your service idea is about a cab service, find people who travel to the office daily and ask them if your idea would solve their commute issues.
- Interview them – Ask them about their current solutions and what are they missing in their current solution.
- Complete Ethnographic research. This sounds complex right but it is not. So, the goal here is to check out target users in their natural environment. To go back to our previous example of daily office commuters, check and analyze to determine if the problem exists.
Validating the Market
So, you have validated that the problem exists and it needs a solution. The next step is to assess the market to understand if it’s large enough to support your idea. How do you do this? Here are some tips:
- Use Google to search your idea’s keywords or relevant topics to find if you have competitors, to get questions or pain points consumers are searching for, and more.
- Check out Google Trends. This handy tool can help you determine how interest has changed in your idea over time, popularity by region, and related ideas.
- Conduct website research on your competitors. How many competitors are there? What kind of features do they offer? What is their pricing like?
- Let’s not forget social media. Explore the social media platforms your target audience is most likely to use. What do your competitors post about? How much engagement or interaction are they getting? Are there any trending hashtags about the market?
Validate the Product or Service
You got validation for the problem and the solution. Now it’s time to prototype a minimally viable product (MVP). To cut down on costs, if your product is physical, you can consider developing a low-tech alternative to test.
Validate the Willingness to Pay
This one is one of the most important processes as it will show you if your product is likely to make money. So how do you do this? One way is by building a validation website. On your website, you should include the following:
- What your product is and what it does, as well as unique features
- A call to action
- An email collection form on the “payment” page so you have potential customers’ email addresses
- A confirmation page explaining that this is a validation site and the product isn’t yet available
- Google Analytics to track data
You can also advertise on Google or Social Media to get a better idea of what traffic might look like. However, ensure to not collect any payment and highlight that the product isn’t available yet and it’s just a survey to gain insights about the market interest.
What’s the Best Way to Validate a Startup Idea?
With Guidance and an Elaborate Validation process from The Venture Studio
The team of innovators at The Venture Studio have supported and guided visionaries in validating their idea through a proven process, and have helped scale them up with connections to talent and capital.
We have a playbook of product-driven validation techniques which we have gathered from decades of experience to ensure that new entrepreneurs are taking a calculative approach before launching their venture.
If you’re ready to find out how The Venture Studio can help you take your product from idea to launch, reach out to us today.
You can also mail us at hello@theventurestudio.co to get started.
