Questions

What questions should I be asking to evaluate an idea for a startup?

I get ideas for startups but don't know if they're good or not.

4answers

Don't ask yourself multiple questions. Ask a potential customer ONE question: "Will you give me $10 or 10 minutes to be on my early access list for a product XYZ that solves your pain ABC?"

This tells you a few things:

1) Is there an identifiable customer and do you know what they look like and how to reach them?

2) Do they have a pain bad enough they know what you were referring to and cared enough to listen?

3) Did they care enough about solving that pain to do something nominal like giving you $10 to be on a special beta list (or whatever)?


Answered 7 years ago

A quick test of a decent idea is trying to sell it. Just go to the mall and see if anyone will buy based purely on your pitch and passion. If your ideal customers are big companies, pick up the phone.

The truth is that 99% of the big companies didn't start off the way they look today. The key to quick decipher the parts of the idea that are interesting is to find a customer, and try and sell them the solution as you describe it.

So, I actually don't think there's good or bad ideas, only ones with super small Total Addressable Markets (ex: of 1, you, to solve a problem that only you care about). But even at that, if you're passionate about the idea, and you end up being the only customer, at least you've made your world a bit better - and that's awesome!

To fully answer this question: I don't decided what a good / bad idea looks like, I just execute and keep learning if there's a "there there" and will I be passionate about the opportunity.

If there isn't, I try something else.


Answered 7 years ago

First things first. I fundamentally agree with what Dan and John have both said, and I have personally taken advice from Dan on a very closely related topic in the past.

I also mentor startups to avoid wasting time like I did in my startups. So beware, because not testing correctly at this phase of the idea is an easy way to cause yourself lots of future pain.

You have three big concerns with any new idea, whether you are a startup or a product manager at a corporation responsible for a new product launch. In order, they are:
1. Who? (is my customer)
2. How painful? (is their problem)
3. What? (will they give me to solve it)

The answers to these questions are obviously all related. The best way to figure out the answers to these questions is to talk to people and ask them non-leading questions (lots of info out there about how to do that. If you want to avoid reading too much, we could chat about how to avoid this.) How do you actually do this?
1. Write down the problem you think you are solving and who you think has it.
2. Talk to those people and ask them what their biggest issues are. Get them to explain any problems that you think might relate to the problem you are solving.
3. Ask them to give you something to solve that problem (essentially do what Dan and John are saying, try selling your vision of the solution). Take careful note of how they respond to the way you describe it.
4. Repeat.

It is important to note that even if the problem isn't a BIG problem for them, meaning it is not in their top 3 problems, that you still may be able to build a business out of it. However, if you are solving what is consistently their number 10 most important problem, your sales cycle will be longer, your growth will be slower, and you will learn how to patiently build a business.

Cheers! And good luck.


Answered 7 years ago

I'd suggest forgetting about "hot trends," and instead focusing on finding problems that lots of people will pay you to solve for them.

Here are some ways to get started:

(a) Have a clear idea of the few areas where you may have a view of what lies just beyond the edge (technology evolution, market needs, etc.)

(b) Identify problems that need to be solved, preferably using primary research (i.e. talking to people).

(c) Remember that sometimes people cannot easily articulate what the problem is, so understanding what the problem is might require some effort.

(d) Figure out if the problem is big/widespread enough that it is worth solving.

Once you have identified a couple of interesting problems worth solving, I'd suggest doing these three things to narrow down the field:

(a) Try to sketch the business model for the startup idea (referring to Business Model Generation - Canvas)
(b) Get good at doing quick and dirty market sizing of opportunities
(c) Check if you are passionate enough about the idea to potentially spend the next 5-8 years of your life in making it successful

Based on a collective evaluation of the above, you might be able to zero in on a small number of ideas to investigate further (e.g. building a prototype, customer development, etc.)

Happy to brainstorm your winning idea resulting from the above exercise, if you'd like to.


Answered 7 years ago

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