Entrepreneurs agree that coming up with startup ideas is easy. The difficulty is deciding which ones to follow. You must test them deliberately.
There is so much advice out there on how to validate startup ideas from people that never build a startup that it makes me puke.
I wasn’t aware of it until I did research for this article. It’s so funny and ridiculous that everyone is repeating each other. The three steps are:
- Step – Create a Landing Page
- Step – Run an Google Adwords or Facebook Ads Campaign
- Step – Contact your leads
It’s always ‘just’, ‘really quickly’, ‘no money involved’. Hence, is startup validation bullshit?
Why am I writing another piece?
I want to make us aware of our short-term thinking. Our wish for short-term pleasure. Quick wins. Easy fixes. As if life is something to be fixed – easily and quickly WITH NO EFFORT involved.
That’s how we think and do stuff in our society. And that’s how most wanna-advisors and wanna-mentors advise first-time starters to do stuff. I’m not saying that I have figured out a better way. There is simply no silver bullet.
I see my job in drawing a more realistic picture of what happens when startup founders and entrepreneurs try to validate their ideas — always in need to handle their emotions.
And even the advice from experts on how to validate startup ideas can misguide you as a first-time starter because it makes you feel at ease. It’s a rational approach to an irrational problem. It’s a rational approach from people who are rational thinkers and doers. They are mostly engineers. For them, the world can be explained rationally.
Just ask five questions. Just follow these three steps. But if it’s that easy WHY aren’t all entrepreneurs successfully validating their ideas? Does this mean we mostly come up with shitty ideas? Why is it that most entrepreneurs think there are ideas like sand corns at the beach?
As I got confused and puzzled, I realized that neither wanna-experts and the real experts hardly talk about the underlying emotions and mindset.
How to deal with negative feedback? How to overcome your own anxiety when something goes bad and stay calm when something goes extremely well? Because both things are irrational behaviors. When it comes to validating your idea, you want to be emotionally stable and not be driven by your emotions.
For some, like for me, this is extremely hard — but it’s doable like everything in life. If we are aware of it, we can better manage for situations in advance and help us remind with little hacks (like bringing a friend, using a script or setting a reminder on our phones).
That’s why I wrote this piece to make you realize that
Being a successful entrepreneur is above all about managing one’s self.
That makes it so hard to write about emotions and advise people what to do because everyone of us needs to find his OWN way to manage their emotions and feelings.
However, when it comes to controlling our emotions, little and simple things can help. I know it sounds counterintuitive.
Let’s explore it.
PS: This is a follow-up post on my previous post— How to Get Startup Ideas.
Your GOAL: Build painkillers, not vitamins
There is a heuristic that will allow you to assess your ideas. Most startup experts recommend that you should build painkillers, not vitamins or candy.
Hence, you must understand a problem by asking people about it, empathize with them and then find a solution that solves a pain-in-the-ass problem.
As empathizing with others is extremely hard, most successful entrepreneurs advise the following:
If this problem is just improving something slightly and is perceived as something “nice-to-have”, you might build a nice lifestyle business based on that but hardly build a high-growth startup.
Only if you sell a MUST HAVE, you will find enough users (B2C) /customers (B2B) to create hyper-growth — the main characteristic of a startup. As you might have read in the previous article on how to get startup ideas, your solution must be at least tenfold better than existing solutions.
If you think that there is an audience that wants your solution, that’s great! So let’s see if they think that too! Get out of the building and talk to them!
Luckily, you don’t have to improvise when validating your problem. The whole process has been well established by Steve Blank’s “Customer Development” methodology and the “Lean Startup Movement” which builds on it.
What is customer discovery?
Customer discovery is a concept created by Steve Blank. The concept works like this. I’m following the chapter “Customer Discovery” in Steve’s book The Four Steps to the Epiphany. Alternatively, get his newer book called The Startup Owner’s Manual.
- Write down both the business and product vision for your company.
- Be aware that your visions are based on many educated guesses. Write down all these hypotheses. I suggest you use the lean canvas focusing on customer, problem, solution and value proposition! It’s okay if you can’t draw a really comprehensive picture due to lack of info yet!
- Identify the hypotheses that contain the most risk for your company if they are wrong. There are three types of risk: product, market and customer risk.
- Test your hypotheses, starting with the riskiest ones! Quantify them if possible.
Only if you have lots of personal contact with potential users (B2C term)/customers (B2B term), you will get a better understanding of their mindset, needs, and desires.
Talk to 100 people to see if there is market opportunity
The most riskiest hypothesis will be the existence of a problem for your audience. If it is not actually there, they won’t care for your solution! That’s why you should start by checking this part of your business vision.
Dave Cummings recommends that you start by talking to at least 100 people to see if a market opportunity is there. For finding so many suitable people, start with potential users you know and use the “snowball technique”. Ask each one of them to recommend 2 more people (must be your ideal early adopter!) you could talk to.
Not all of your potential users are equally important. Focus on the ones that will potentially generate the most revenue, easiest to acquire, least service required or will refer your solution to friends (helping you to hypergrow through virality). If you want to offer a freemium model, keep special attention to users that you think will pay and neglect others!
Plus — don’t restrict yourself to your friends and family. They might feel compelled to be nice and encourage you. You’ll get a more unbiased feedback if you speak with people you’re not directly affiliated with.
Handle your emotions: 5 How to’s
You might find out that all this reaching out to customers is actually a lot harder than it sounds! Still, it’s so crucial to understand that you can’t avoid it.
Don’t worry: it might feel stressful in the beginning, but learning about your customers will soon start to give you fun.
Remember the insight of Ash Maurya who couldn’t force himself to do it properly until he realized that “life was too short to keep on building something nobody (or not enough people) wants”!
- Being rejected is a form of learning. Accept that learning and so failing is part of our life as breathing. Very few people talk about their failures. Everyone made them. You are not alone! Trust me. I fail daily.
- Don’t get too excited about a customer’s feedback in an interview. It is a fine line between shutting off your emotions and being authentic. Be mindful and stay present when emotions of victory arise. Never a good sign because they prevent you from actively listening to your ideal early customer. Maybe it’s a “yes, it a great idea but …” sentence. Your victory feeling will prevent you from understanding ‘the but’. Active listening is a key skill, you need to develop as a startup founder/entrepreneur.
- Scripting your interviews and a great preparation is key. Invest time to research about the person in front of you. Pay her respect by honoring their time by being punctual, staying present and on time. A 15-minute interview is a 15-minute interview.
- Take notes after the interview. The interview itself should be a conversation. Don’t come across like a boring scientist who hides behind his paper. Practice eye contact. Create a trustworthy situation (important to pick the right place, time of day etc). Your goal is learning. You want to dig deep, not just small talk. Think hard about how to create a trust building situation that allows for true sharing of experiences and emotions.
- Follow up properly. AGAIN SHOW RESPECT by thanking the interviewee authentically. Maybe write a handwritten note. Tweet them. Share the article you’ve mentioned. Do something special by researching for an industry research paper that might be helpful to the interviewee – even though your solution is not. These random acts of kindness will set you apart in the long run!
A few ways NOT to validate painkillers
I got a few inspirations from the following post: Is startup validation bullshit?
- Your mom will never tell you that your idea sucks. Go to your mom to get a great meal, a hug and love, but don’t ask her what she thinks about your business. Don’t look for approval and permission any longer. Do your thing and ensure her that you’re healthy and happy. That’s what she’s most concerned about, not your project.
- Media exposure doesn’t validate your idea because media have their own agenda. They like novelty ideas, or bizarre ideas. As journalists are probably not your customers, don’t give a shit what they say about your solution (even though it’s emotionally hard. Sometimes you need to fight back. Remember: Choose your battles wisely.) Best is to listen to your customers.
- Random people who say they like your idea isn’t validation either. It’s poison. Even though it feels nice that someone values your work. But if this someone isn’t your targeted customer, you couldn’t care less.
- Traffic to your site means nothing, especially if you get featured on some tech blog: the visitors will probably be entrepreneurs who just want to sniff out your product but don’t want to buy.
- Awards and industry accolades. Worse than poison.
How to make sure you build painkillers
Customer discovery consists of several steps. Depending on the author, the number of steps varies. BUT the number of steps is merely as important than having the right mindset.
You must set yourself up for learning to validate your idea. It’s damn hard. It’s anything but easy.
That’s why I now feel that all the books out there are good approaches to the same thing, but neglect the psychology involved. No one is as rational as computer programs. And as these books are mostly (so far) written by engineers they follow a certain logic.
By far, my favorite is Ash Maurya, one of the chief evangelists of the Lean Startup, originator of the Lean Canvas and author of Running Lean. He wrote a highly tactical book that I strongly recommend to check out.
He outlines three steps:
- Do systemized problem interviews
- Do systemized solution interviews
- Build a minimum viable product
#1: Do systemized problem interviews
Start by doing so-called “problem interviews“. The term “interview” implies that you should do it in a disciplined manner. Don’t sell yet and don’t ask questions that are leading people to certain answers, though you might feel like doing that.
These interviews are not about making people excited about your project, but about learning how their world and their problems look like. Stay focused on learning, not selling that comes later. You shouldn’t do both things at the same time!
Ask open-ended questions and focus on understanding three things:
- Who is the prototypical early adopter of your solution?
- How badly do they want the problem you see solved?
- How do they solve it today?
Keep it short (15-20 minutes). You want to use a script with the topics you want to discuss in your conversation to stay focused.
#2: Do systemized solution interviews
When you’ve learned about your problem, you can move on to interviewing your ideal early adopters about the solution you envision. Only now, you should start with introducing your solution (not earlier) and focus on the following questions:
- Customer risk: Who has the pain? How do you identify early adopters?
- Product risk: What is the minimum feature set needed to launch?
- Market risk: Will customers pay for a solution? What price will they bear?
Again, learning is key. You aren’t selling yet!
As you move on, you should also run some experiments that will show if there is a need for your solution:
Example #1: Do what Stanley Tang (co-founder of doordash and of the speakers of “How to start a startup”) did:
We decided to create a simple experiment with restaurant delivery. We spent about an afternoon just putting together a quick landing page. When I went on the Internet, I found some PDF menus of restaurants in Palo Alto. We stuck it up there and added a phone number at the bottom, which was actually our personal cell phone number. And that was it. We put up the landing page and called it PaloAltoDelivery.com. It was super simple, ugly, and honestly we weren’t really expecting anything – we just launched it. What we wanted to see was just would we receive phone calls, and if we got enough phone calls, then maybe this delivery idea was worth pursuing.
Example #2: Do what the Buffer founders did: Idea to paying customers in 7 weeks:
I’m an advocate of the lean startup principles which Eric Ries proposes. With my first startup, I learned a huge amount about the principles and I tried to implement them as much as I could. I found that practice is much harder than theory. I even started coding Buffer before I’d tested the viability of the business. As soon as I realized that I stopped, took a deep breath and told myself: do it the right way this time. It was time to test whether people wanted this product.
Always serve the first few customers yourself. It is a great way to learn more about them!
#3: Build a minimum viable product
When these tests run well, try to create a so-called “Minimum Viable Product” (MVP) as quickly as possible. MVP is a key concept of the Lean Startup movement and means a first version of the product that has the minimum feature set it needs to satisfy users (but not more)!
You will have to find out from your customer interviews what this minimum feature set is but keep in mind what Eric Ries keeps underlining:
Still, it must be “viable”! People don’t like half-baked beta versions, so don’t ship any of them. The concept of MVP is about keeping the features lean, not about putting something together hastily.
Don’t go into the “selling”-mode with your MVP yet. Use it as a means for learning more about your customers and the solution that will serve them best!
Lean Startup advocates a “Build-Measure-Learn” approach: After you build your MPV, try to learn from customers how to make it even better. See if it’s intuitive to use for if important features are missing, if there are things that bug them… Only then “build” again. Adapt your MVP and learn from your users again!
Repeat this loop several times until your customers are truly happy with a solution.
Emmett Shear (co-founder of Twitch) points out that those guys often have different problems than the ones who are using your service. By talking to them, you can fix some issues that threaten your user retention which is extremely important for sustainable growth!
However, Emmett emphasizes that by reaching out to your new customers, those guys won’t be your most promising audience. As your product becomes more advanced, you should also start to talk to people who fit your target audience profile but are not using your kind of service at all. By removing the barriers that keep them from joining your user base, you can prepare your company for conquering the targeted market!
Your overall early stage startup’s goal is to reach product/market fit – but let’s talk about that a bit later.
On his popular blog – For Entrepreneurs – you can find an article that describes in detail how to use online survey tools to validate your key startup assumptions, and gain actionable insights into topics such as pricing, target demographics, messaging. Check it out here.
Further reading: Test your startup idea: A list that took me eight years to develop.
Enough theory! Real world examples…
There are real world cases everywhere, just search for “how I validated my startup idea”. Let’s quickly look at their approaches and where they are today.
Explore thousands of just launched products and learn from them. Here is an article on nine entrepreneurs revealing how they validated their business idea.
Common characteristics are:
- Describe core value in a tweet: a single reason someone would be willing to buy your solution.
- Scratch your own itch.
- Empathize with your target audience. Become one of them. Use the Empathy Map as guidance.
- Testing demand via Adwords before building.
- Sell before you build by asking complete strangers who don’t care about you at all to sign up and pay before your solution was even built. Also, build momentum this way and stay motivated.
- Ask industry experts to validate numbers and understand economic feasibility of your project.
Another Example: Griggi
They used a good looking landing page and focused on validating their idea. The effort, maximum six days. They decided against the build MVP approach because it would have taken them six months to build it.
I agree that the Lean Startup philosophy can be misleading for most of us. It’s good for developers who don’t want to speak to humans and rather develop a MVP (that isn’t a prototype of your solution, we’ll get to this in What is Lean Startup.)
Even though, the theory says build a MVP, the founders experienced that the approach didn’t work because half cooked MVPs mostly fail, surveys are useless, and a “coming soon” page doesn’t help either.
Think about your business model as much as the customer’s problem
One last piece of advice: Building something people want is the most important thing, but it is not everything!
That’s why Steve Blank advises people to think about business models and not only customers. It’s great when you finally manage to build a product that users love, but will they pay for it?
If they don’t pay for your product directly, how are you going to make money? How will you reach a big audience? All these questions around your business model should not be neglected. Keep them in mind; You must test them as well.
Don’t Be a Wantrepreneur!
It doesn’t take long or much money to test your ideas (aka problems). Don’t think for too long if you’re wasting time or not spending your resources wisely. You simply cannot anticipate and foresee all possible angles.
Whenever I talk to students, they often tell me that there are less concerned about failing or not making money. That’s great!
But they simply don’t know HOW TO START. They feel overwhelmed. They are afraid of spending their time on something useless. They overthink. They overcomplicate.
I was there. Exactly there. I led them years ago 🙂
Not doing anything, but reading and discussing how awesome it must be to be an entrepreneur.
Now I know, and I learned it the hard way that starting projects is really about doing. Test little things. Don’t think too much. The more you try and do, the smarter you’ll get.
Most successful entrepreneurs even say the less you think, the more likely you are to start.
Because if you knew about all the hard shit in the first place, you’d never have started at all.
And of course, don’t reinvent the wheel, always get the basics right and follow current best practices. Pat Flynn, blogger and awesome dude of the Smart Passive Income Blog, launched his new book Will It Fly.
In a previous post, he outlined 6 ways to validate a product idea before you waste your time and money:
- Share your idea
- Find similar products that already exist
- Pay attention to “signs”
- Create a mini-version of your product (instead of a MVP, write an ebook)
- Sell before you build
Tim Ferriss outlines in his book The 4-Hour Workweek practical guide to test your ideas. In a blog post from September 24, 2011 he went over the steps again:
- Find your (profitable) idea.
- Find $1,000,000 worth of customers.
- Assess your customer’s value.
- Validate your idea.
- Day – Foundation
- Day – Doing more of what works (personal network + wholesales)
- Day – Marketplaces + Groups + Advertising
- Day – Giveaways / Google / Random ideas
- Day – Bringing it all together
I know it might look like an overly simplistic approach, but it works. It teaches you a critical entrepreneurial skill: Validating your ideas. Validating your decisions. You’ll be faced by thousands of them along your journey. Better build habits and the right mindset to deliberately practice validating anything and making decisions to move forward.
Don’t sit back and be afraid of making the wrong decision because a wrong decision is better than NO decision.
Doing something is better than doing nothing!
So – Don’t think about your ideas. Don’t just meet with friends and discuss them.
DON’T BE A WANNAPRENEUR.
The perfect time is always NOW.
#EntrepreneurHack: Remember the following tips
It’s never just three steps you follow to validate your startup ideas and done. It’s being honest, listening to feedback, not feeling personally attacked, not feeling frightened … not … not… and so much. Try to be aware of it when you start feeling something inside you and anticipate accordingly the next time …
Scratch your own itch meaning solve a problem you have.
Customer discovery is NOT about reading articles and papers. It’s about “getting out of the building!”
Listen to users who unsubscribed from your service and went to competitors.
Validating your decisions using surveys.
Validate a meaningful problem before implementing it. It’s an iterative process. It should be based on hard statistics.
Think about your business model as much as the customer’s problem. Get an expert in using Lean Canvas and Business Model Canvas.
Learn and deliberately practice how to validate your ideas in days, not months — before building and investing in any solution!
- Dave Cummings:
- Steve Blank: Watch the Lean Approach and Get out of the building
- Ash Maurya: Running Lean & Lean Canvas
- Alexander Osterwalder’s tool: Business Model Canvas
- Dan Norris, founder WP Curve: Is startup validation bullshit?
- 37Signals: What’s Your Problem?
- Buffer: Idea to paying customers in 7 weeks
- Lean Startup Principle: Minimum Viable Product
- For Entrepreneurs: Validating your Decisions Using Surveys
- Test your startup idea: A list that took me 8 years to develop
- Copyblogger: Empathy Maps: A Complete Guide to Crawling Inside Your Customer’s Head
- Kick off Boost: Explore thousands of just launched products
- Entrepreneur.com: 9 entrepreneurs revealing how they validated their business idea
- Pat Flynn: Will It Fly [book]
- Noah Kagan: How to Create a $4,000 Per Month Muse in 5 Days
- Tim Ferriss: The 4-Hour Workweek
- StartupGeist on How to Get Startup Ideas
- StartupGeist on What is a Startup?