5 Steps to Validate Your Business Idea in the Real World
Or, how not to waste 5 years of your life building a dud
If you run a business or plan to start one sometime soon, that business is going to run in the real world, with real world customers. That’s the reason why you need real, hands-on feedback from people before jumping in head first and committing fully to the business idea.
Feedback helps you make better business decisions.
This article looks at how to get validation for your business idea. This straightforward approach will improve your launch and help you build compelling solutions.
First, let’s get a broader idea of what idea validation actually is.
What is Idea Validation?
Even though tech advances have lowered the barrier to entry when starting a business, nobody wants to waste time building a product nobody is interested in. Idea validation is the process of testing and validating your idea prior to launching your business product, service or website. Think of it as the research and development process big companies use to test product ideas before they’re released to the general public.
Idea validation can involve anything from information-gathering interviews to special landing pages on the web. The entire purpose is to expose the idea to your target audience before you build and release the final product.
Personally, I think the best and ideal way to conduct the idea validation process is face-to-face, in person or over a Skype video call. The advantages will be highlighted below.
Why Must I Do this Idea Validation Thing?
It’s not compulsory to validate your idea before starting out. It’s just that it will save you a ton of time and money, as well as generate interest in your idea. After all, the best way to test your idea is by exposing it to the marketplace.
Don’t make the rookie mistake of working on an idea that no one is really interested in. Idea validation can save you time by giving you a good feel as to whether your idea appeals to your potential audience. It can also save you a lot of money.
Do not assume you know what your potential customer wants. Customers have a knack for proving assumptions wrong. Only the customer knows what he/she really wants, needs and is willing to pay for.
So the entire validation process will tell you whether or not you should commit to building your thing or not. For example, you could end up paying thousands of dollars building an expensive version of a product that your customers may not even want, need and will never use.
5 Steps to Idea Validation in the Real World
Idea validation is fairly easy but it will require some hustle on your part (and that’s what you do best, right?). In order to best demonstrate how to do this, I’ll be using my own experience as a running example.
Prior to when we started building Buffrspace, we needed to validate the idea. This process is the blueprint of what we followed for our own validation.
Step 1: Brainstorm Internally
You need to decide what exactly you’re presenting to your potential clients. You probably have thousands of ideas about what you want to do but you need to present only 4–5 at a time. In our case, it was 3–4 different variations of the space sharing model. In your case it could be the top 3 features your business or product will have.
Anything more than five is way too confusing. Plus, you do not want to take too much of the potential customer’s time. Ten minutes max. You may want to contact them later for more info so you want this interview short and sweet. In this step, your goal is to identify your best solutions or versions of your idea.
Step 2: Don’t ask Family and Friends
You should be careful about asking your family and friends for feedback on your business idea. It may be tempting, especially as they are easily accessible, but you absolutely shouldn’t.
To be honest, we all want to feel good about what we are doing so sometimes we ask our loved ones about our ideas knowing that it will feel good. The problem though is not that your family and friends are liars. The problem is that they’re by default, biased and in some cases, not one of your potential customers.
They might also feel forced to give feedback for feedback’s sake. This could lead to them make up stuff which they don’t really believe in so you feel like they’re being unbiased. One thing you don’t want is wondering if the feedback you’re receiving is genuine or tainted with bias. Best to steer clear.
Step 3: Choose your Interviewees
Next, make a list of 15 potential clients you can reach out to and interview for 10 minutes in person or over a Skype video. Think about your ideal customers.
For us at Buffrspace, it was new entrepreneurs, freelancers and forward facing corporations who would need space sharing and cost cutting solutions. We identified businesses in our neighborhood we could approach. We also reached out to entrepreneurs we had done business with before and several heads of Human Resources at a multinational corporations.
Make sure you can secure 10 minutes of their time in person or over Skype. A natural back and forth conversation is essential. It’s hard to feel excitement, hesitation, or astonishment over the phone. And these are all essential parts of the feedback chain.
Step 4: Conduct Your Informal Interview
Be courteous. Thank them for their time and let them know how much their feedback will help you build something meaningful and successful. People like knowing that their opinion matters.
Second, make it clear that you are not selling anything to them and what you are going to be talking about is actually not even available yet. Put them at ease.
Third, take a minute to explain what you do and the nature of your business before explaining what you need their opinion on. Remember to explain things with their perspective in mind. Use words they would easily understand.
Fourth, tell them you are going to present several variations of your idea. And that you will go through all of them first, then go over each one asking for their thoughts about each one at a time. Let them know you might be jotting down some notes during the process to remember their advice later on.
Fifth, after going through all 4–5, ask them for their initial thoughts for each one individually. Ask how the idea makes them feel as well as think. Look at their body language and how quickly they answer. Compare their reaction to the reactions of other ideas you present to gauge what is brilliant to them and what is a dud. Body language is as important as words being spoken in this interview, so be alert for cues.
Be prepared for surprises. Many of the sure fire ideas (at least in our estimation), did not elicit the responses and excitement we expected. Conversely, some of the people we interviewed were genuinely intrigued and even asked to notify them when we launched. Remember, you’re not there to argue or persuade them to like your idea. You’re there to watch and listen to their reaction and thoughts about your business idea.
Lastly, after you have received their feedback on each idea. Thank them again and ask them if you could contact them again for further feedback, should the need arise.
Step 5: Review and Decide
The last step is to review all your feedback and decide what worked best for your potential clients. When you decide based on the feedback you received, remember that it’s about the customer, not you. Sometimes you will have to give up what you think is best for your business based on what you learned. After all, your customers are the reason why you exist.
This doesn’t have to be a boring, tedious exercise. This is your business, your baby you’re building. It should be fun. Let your love and care for it shine through. Loosen up and enjoy the ride. Also, your interviewees take cues from you, so if you are relaxed and casual about it they will loosen up and give you more than you ask for.
Do you do business in Africa or have plans to?
BuffrSpace is helping hundreds of entrepreneurs, professionals, freelancers and business owners increase their efficiency, reduce costs and manage their teams by providing them with access to shared workspaces, all available on-demand.
We also help organizations transition into the remote working culture by offering expert advisory services.
Startup founders, distributed teams, freelancers, remote workers, business travelers, and anyone else in between can save themselves the hassles of hefty yearly office rental, long commutes, erratic power supply and crazy traffic by enjoying the freedom and opportunities of remote working and workspace sharing.
Do you have an office or work space you would like to share (and earn more money)? Please start here.