The difference between success and failure of a tech startup business is often found in its initial planning.
A new mobile app concept the startup came up with can be developed with innovative technologies, and its execution might be inspired, but the concept can fall flat if the market doesn’t adopt it.
Such failures can be foreseen and avoided with some foresight and validation during the planning stage of a project.
The best way to ensure there’s firm ground to your startup idea is to validate it before you begin.
In this article, we’ll look at three essential ways to critically evaluate an idea that will ensure your startup experiences rapid growth.
1. Brainstorm, research, and decide
Startups don’t have the luxury of thorough planning and market research that enterprises can bring to bear on a new product idea.
They have limited resources and time to bring an initial idea to market and prove it to both customers and investors.
The brainstorming stage of the process gives your ideas and technical solutions definite shape.
- For any product to succeed, it needs to solve a problem better than other options that your customers may have.
- Some brainstorming methods start by identifying a problem and creating a solution for it.
- Another method starts with a concept and discovers the problems it can solve. Either way, an idea needs to serve an unmet need to be viable.
Once an idea has taken shape, it’s time to test its assumptions. It’s possible that you’re simply unaware that a good solution already exists for the problem your idea will address.
Customers who’re satisfied with an existing solution aren’t likely to switch to an unproven one.
Likewise, it may be that the technical assumptions of your idea are overly optimistic.
Your market and technical research need to be brutally honest, otherwise, you may end up developing a product with only a small chance of success.
Startups only have a short window for brainstorming and researching product ideas before they run out of time.
- When it’s clear that you have a viable product, take it to the next level.
- If it’s not clear, it’s best to stop and reassess. Your precious startup capital needs to be devoted to an idea with a good chance of success.
- If the research doesn’t bear out the concept, move on to another idea. You may not have time to research the idea fully, though, so the decision-making process needs to be pragmatic.
- If it looks like it’ll take too long to test out an idea, you may need to look for a clearer opportunity to pursue.
2. Test your assumptions with objective research
The assumptions you make in your product concept determines the likelihood that it’s a realistic solution for future customers.
So it’s important to discover and challenge them quickly and effectively.
The more specific your research becomes, and the more often you ask the right questions, the more likely you’ll validate your concept with certainty before jumping into development.
The questions you should ask include:
- Who will be your product’s primary customers? A product without a natural customer base will have a difficult time with market adoption.
- What unmet need or unsolved problem does it address? Some ideas are interesting and attractive, but they don’t solve a problem that makes them a sure sell to customers.
- Are there other solutions available that your product will complete with? A competition that’s already well-established as a solution to the same problem will be a hurdle to overcome.
- What are the essential features and functionality of your app? Develop a minimum viable product description, and be specific about the features your product must-have.
- What are the technologies that will make your concept a reality? Take time to assess what technologies are available for your product to be built with.
These are the hard questions that need hard data and honest answers to ensure a product idea has a good chance of success.
When researching these questions, it’s important to find quantitative data to back up your conclusions.
These basic market-driven questions are essential to explore before you begin.
3. Discover the real value of your idea
A new product is valuable in the eyes of its creators who put the time and energy into bringing it to market. After all, it’s the product of their own work and creativity.
That doesn’t mean it’ll have obvious value to the customers to whom it is marketed.
You’ll need to examine the value proposition a product makes to customers and whether it’s compelling.
That, in turn, means interviewing customers to discover whether an app or service will be something they’d realistically buy.
Conducting interviews can be tricky if you let your potential customers make general statements without drilling down into their reasoning.
There’s a natural tendency to tell market researchers an idea is interesting or helpful because most people want to please others.
Follow-up on positive feedback and not just negative feedback.
It’s important to discover why someone doesn’t like your concept, but it’s just as revealing to know why they do like it.
Another critical issue is what price future customers are willing to pay for your product.
If you won’t be able to cover your costs with the price the market is willing to pay, your idea won’t be viable in the long run.
The profit margin that you can justify with market research will also play a large role in securing investor buy-in.
The financial and marketing validation of a technology startup is a piece of the puzzle that sometimes gets lost in vague market projections.
It doesn’t help that technology projects often take longer than other businesses to achieve a large enough customer base to earn a profit.
Nonetheless, assessing the value of a product in dollars and cents will be key to making effective decisions and convincing outside investors that a project will be a long-term success.
A startup idea is often an object of faith for the founders and early adopters who launch a new business built around a mobile app or software concept.
While passion is important to take a product from concept to deployment, it’s important to validate its basic assumptions and value before a startup commits resources to a development project.
By following these three basic steps, an objective product validation will prove your concept is viable.
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Ashley Wilson is a digital nomad writing about business and tech. She workes remotely as a content creator for various SMBs. In her spare time, she enjoys cooking homemade treats and trying out new flavors. You can get in touch with Ashley via Twitter.