Ideation for a new venture can be a long, frustrating, mentally exhausting process. This is especially true for repeat entrepreneurs who have lost some of their optimism and tend to overthink everything in the ideation process and resemble the thinking of an investor more than a first time founder (how could this fail vs. how could this succeed).
In their first ventures, in many cases, founders build solutions to problems they have faced or were passionate about, a pain she/he felt or came across or an idea that evolved while the founder had an insight into how a certain industry works (or doesn’t work). In their next venture, repeat entrepreneurs, who would often like to stay away from their previous domain, kick-off a (sometimes two years long) ideation process, hunting for an idea for their next venture.
The ideation cycle usually starts with a seed concept/thesis coming through industry experts, investors, fellow founders or else (check out this list). The next step is usually a brief research of the field in order to find a niche within it, followed by initial interviews of domain experts in which founders ask more than they present. Then some more internal research, leading to a formation of a basic concept/thesis. At this point the founders usually go out and try to sell their concept to potential buyers/users/investors for further validation, then using the feedbacks for some iteration and fine-tuning of the concept before a go no-go decision. In most cases this process results in a few steps back to base 0. Every such ‘zero to zero’ process takes between a week to a few months.
Strong founders move forward fast with evaluation of ideas, but still find it challenging to make an all-in decision. This is especially true in times when funding isn’t an issue for such founders. So when’s the right moment to jump in and how to run a productive ideation process? Working with dozens of repeat entrepreneurs at the ideation phase at Emerge, I’ve curated some tips to help in the process (some tips might be more relevant for B2B ventures).
- Assess the founders-market fit early on
Whether the skills, insights, access you have create an unfair advantage or good fit at minimum. (e.g. a team of B2B, enterprise software experts finalising a long process, realising that a B2C health tech venture is not the best fit for their skills, despite being an interesting opportunity).
2. In many cases pivoting within a domain is smarter than starting from scratch within a new one
From our experience ideation ends/venture begins following a hint someone (see point #3) says once you already have depth into that domain rather than a love at first sight. A 6 months process, evaluating the same sub-problem is probably too long, but a week is too short.
3. External research (aka asking domain experts) is a 10x shortcut vs. internal research
This is true not only for validation within a specific direction, but also to discover new directions within the domain of exploration.
4. Meet people who failed in the domain you are exploring
They are usually more open to share their views, mistakes and what would have helped them reach a different outcome (go to point #6).
5. Be careful of too positive feedback
- A customer that was excited by a product, but he is not a reflection of the entire market or simply not the decision maker.
- A VC that gets excited by you, not the market, and counts on your ability to pivot.
6. Be careful of too negative feedback (specifically from entrepreneurs who operate in that field)
- Usually people from a specific field will recommend to avoid that field. Listen, but don’t make decisions solely based on it. Every industry has its own complications.
- Reaching the right company is not as important as reaching the right person within it. Hearing a NO could simply be a result of speaking with the wrong person at the organisation
7. Move fast with market assessment
This is pretty straight forward and can shorten your way to the go no-go decision. Specifically:
- Bottom-up estimation of market size
- Timing to market and trend
- Whether Need > Demand > Urgency
- Competitive landscape
8. Check personal alignment before you jump in
Sometimes founders reach the go-no go decision feeling strong about an opportunity, but realising that they can’t imagine themselves moving forward with what they ended up with for the next 10 years.
Passion for the field/problem you are tackling is probably the most important factor to have when moving forward.
9. Make a decision
You can run in circles forever, you will always have doubts and there is no innovation without risk. Take that risk.
10. Extra small tips
1. Zoom out often. Try to diversify your process to generate “creative” ideas (atmosphere, location, people, etc).
2. Document everything — you never know when and what information you discover will be valuable
3. Don’t be afraid to talk about your idea — execution matters
4. Embrace the process. It is a peek into your next decade and the best playground for new partners
5. Acknowledge that this is an (almost) never ending process: ideation — product-market fit — growth engines — next steps