The first step to assess whether your startup idea has any potential value is to find if there are real users out there who want your product. In other words, you are looking to validate your startup idea to see if there is a market for which your product is a solution to a real, existing problem.
In order to minimise your risks, you need to minimise guessing. The only way to do that is to stop thinking about your idea and to talk to actual potential customers in order to learn some facts.
When you create a startup, you want to validate your assumption about your customers, your market, and your product early and often. You can’t guess what people want, even when you feel that you yourself could be a user for your own product. You need to get a bigger, clearer view of the market.
I am assuming that you have spent the requisite time to refine your idea. You could use my previous article “The 7 questions that will clarify your startup idea” as a start.
How to start validate your startup idea?
If you think that you have identified an unmet need in a market, you want to validate this is an actual problem. It is OK not to focus too much on a solution at this point.
If you have an idea for a new product, you need to think who could be your first customer and check with him or her that there is, indeed, an actual problem. Focus on identifying and validating the problem first.
If you have an idea for an improved product, you need to understand how people are evaluating offers in this market. Don’t improve on an axis on which people don’t feel they need more of that particular feature. Don’t try to build a better mousetrap. Can you make an offer that people perceive as so much better that they will use your product? Can you find tasks or jobs that people want to do that are not possible already with current products? Focus on finding these jobs and on what outcomes people are expecting.
What kind of information are you looking for?
Validate that you have identified a real problem. Is it an urgent problem? Is it an unmet need?
Validate that you have the right product for the right market. It will probably not happen the first time, so get ready to update your idea and solution once you get some hard facts from potential customers.
You need to validate that this is a “must have” and not a “nice to have” product. Define precisely who your potential target customer segment(s) is. Discover users’ needs and prioritise them. Find out the exact jobs they want done in relation to this specific problem.
Understand why users want a solution for this problem. Understand the consequences for them of not having a solution. If your idea is about a new product, you want to find what “workaround” users might be using right now.
List the most important criteria your customer will use to evaluate and compare your product. (Ex: speed, simplicity of use, price, being able to use it on-the-go, etc.)
Find what features are absolutely necessary for a Minimum Viable Product. Find out what the few main benefits they are looking for.
List what all the desired outcomes they are expecting. What exactly do they expect to have occur after having used your product or service?
Validate whether they are willing to pay to have their problem solved.
Method #1: Do personal interviews
Nothing will replace direct feedback from potential customers. If you are serious about building a startup, you have to do it as soon as possible. The best way is to meet them in person, however using the phone or Skype is fine. If you have no choice, try email. Be ready to talk to many people.
How do you contact them?
If your product targets a B2B market, you should try to use your network to be introduced to the right person. If you can’t, you should try cold calling; it is not as hard as it sounds. You can find these people by looking at newspapers, magazines, blogs, LinkedIn, business or trade associations in the market, etc.
If you can’t find potential clients, try indirect methods to validate your startup idea, by finding people who might act as intermediaries to connect you to your final customer, like a reseller. If you are not planning to sell directly to the customer, you want to talk to everybody in the value chain.
Try to contact them by email first to arrange a convenient time for them. You could also try to call them directly. Here is what you could say: “Hello, my name is Sebastien, and I am building a startup to solve the problem of entrepreneurs having difficulties to get quality feedback for their products. I don’t want to sell you anything. I am just looking for experienced people who may have the problem and with whom I can talk to.
Do you think it could be possible to meet for 20 minutes to discuss how you and your company are solving this problem?” If they say “no,” thank them and ask “Whom do you think I could talk to?” When you meet or talk to people, always ask them if they could introduce you to more contacts.
If you are targeting B2C, you have to find where these people are congregating. What website, forums, blogs are they reading? Where are they gathering in the physical world? Start your own blog on the subject. Try to engage in conversation with them, and after you have built a relationship and they know you better, ask them if they are ready to talk to you on the phone and help you build your product.
Try posting on a forum that you are looking for people to help you solve the problem you have identified, and you want a few minutes of their time to discuss this with you. Maybe you could contact them as a follow-up after they have taken a survey.
What to ask during the interview?
First, to validate your startup idea, you want to verify that this person actually qualifies as a potential customer.
Second, you want to confirm that there is a problem. Describe the problem to him or her, and see what their reactions are. Does he or she feel it applies to their own situation? Do these people think they have a different problem? Listen a lot, and don’t try to prove that you know better than they do.
Third, you might want to understand how they are currently solving the problem. What are the difficulties or limitations of their current methods? If they are not solving the problem, what are the consequences of it not being solved?
Finally, talk about your solution. Are they interested? Do they understand your explanation? What questions do they have? Ask them if they would be willing to pay to have that product, however be aware that it doesn’t prove anything, however it is a start. Show them your product or a prototype if you have one. Ask them to use it to solve their problem. See how things go.
Method #2: Use online surveys
Another method to validate your startup idea is to use a survey. Surveys could be extremely useful, however it will not replace talking to real people. When you are talking to somebody, you can go deeper by asking more questions. Surveys tend to be more useful for confirmatory research than for exploratory research.
How to set up a survey?
There are many companies proposing tools to set a survey up quickly. Just do a search, and see what services and products get great reviews and meet your budget constraints.
What to ask?
If you want people to fill your survey, try to make it short and without too many open-ended questions. For the type of research that we are doing to validate your startup idea, open-ended questions will work better to gather unhindered, open information. Multiple-choice questions are better when you understand your market and want to quantify it.
First, ask some questions to validate that the person is actually in your target market. Then try to understand better how he or she sees the problem you have identified. Example:
- What is your biggest challenge concerning xxx?
- How would you like to have this problem solved? What would be the best outcome?
- What did you already try that didn’t work?
- How much would you pay to solve the problem immediately?
How do you get people to take your survey?
When you ask them to take your survey, make it clear that you are actually trying to help them solve one of their problems. Indicate clearly how long it might take them to fill out the entire survey. Always try to make it simple and easy for them to answer it.
First, you can try to send an email, with an explanation and a link to your survey, to everybody in your address book and ask them to forward it on to people they think might qualify.
Then, find where your target audience is congregating online and ask them at that site. Explain clearly the reason you are doing this. You can try to go through business or trade associations or websites in this market. Ask them to send your survey to their mailing list in exchange for a summary of the results that they could share. Write post on forums and websites. If you have a blog targeting that market and have built a mailing list, this is the perfect opportunity to ask, using your list.
One way to increase the number of responses is to provide something in exchange for your respondents’ time. It doesn’t have to be money. It could be some eBook, a report, or a free video–anything that has value to them. SurveyMonkey offers the option of adding a Sweepstake to win Amazon Gift Cards.
If you still have problems getting people to take your survey, you could use http://askyourtargetmarket.com, which can help you get some people to respond to a survey. It might be possible to use Google AdWord to drive traffic to a survey page, however I haven’t tried that approach yet.
How many answers should you have before thinking you have received enough? For open-ended questions, in general, you have enough responses when you start to see similar answers coming repeatedly.
What comes next?
If you are committed to start a business, then you must talk to customers. This is the only way to gain concrete facts. Do you prefer doing this early on, while it is still easy to fix things, or later, when you have built a product and then discovered this is not what your potential customers want?
You have to see the world through the eyes of your prospective users/customers. What are they reading? What are they buying? Which problems that you can identify by reading the forums? Interact with these people online. Start a blog. Try to connect to your customers’ world.
There are many ways to validate your startup idea and get feedback. Be creative. Even if you have a rough prototype, you could use the service like UserTesting to gain a better understanding of how people see and interact with your product, however this is still not a substitute for showing your product to real, potential customers.
What should you do if you find that your idea is not as great as you expected? First, don’t worry; there are a lot of ways to improve it. Are you targeting the right people? Is there another market that might be in need of your solution? How could you change your solution to be closer to what people need?
If you can’t find a way to fix your idea, just be happy you found out this problem early. Now, start to find another idea, and try again. Remember that the best way to lose is not to play.
Getting customer feedback can not be delegated
Why? Founders get out of the building (physically or virtually) to validate your startup idea and test your hypotheses against reality. There are times when customers are going to tell you something that you don’t want to hear. Or you’re going to hear something completely unexpected or orthogonal to what you expected.