How to validate my business idea?

Review of 9 idea validation tools by Antler

Published in

Inside Inovo

7 min readMar 15, 2023

Contemplating various ideas can be a quite engaging activity — dozens, if not hundreds of possibilities all painting dreamy pictures of fame and success. There’s a problem, though — none of them are real before the first user wires the money-in!

Therefore, the last guest of our monthly “Founder Wannabees” evening was Antler — one of the day zero investors who’ve seen how hundreds of teams were validating business ideas. Here are some notes from the lecture given by Yash with some additional inputs from Kris.

You can join the next f2f meeting in Warsaw by applying via this link.

How to Evaluate Startup Ideas?

Startup idea is composed of 3 parts:
1. A problem. It’s basically the initial conditions. You have to explain, what is the setting for this company that allows it to be able to grow quickly.
2. The solution. This is basically what is the experiment that you’re basically running within those conditions for it to grow really quickly?
3. Your insight. So what’s your explanation why the thing that you’re going to try, your experiment is going to end up being successful?
~How to Evaluate Startup Ideas by Ycombinator

What’s a good problem to solve?

First you need to make sure that you really undeststand the problem that you are trying to solve. Here are some characteristics of the problems that successful startups solve:

Painful / Expensive. Solving this kind of problems might be more rewarding financially — you will be able to charge more.
Popular. The more people have this problem the bigger company you can build.
Frequent. The more often the problem happens, the more annoying it is, and the more opportunities to show value of your product.
Urgent. If your customers has the problem now he will be more likely to buy your product now instead of waiting for the right time.
Growing. Some problems are getting worse over time — and the more value your solution might bring.
Unavoidable. Well, if you can skip this problem it’s not a real problem, right?

The best way to start is by formulating a hypothesis

A startup idea is basically a hypothesis and this is the way you should think about it. It’s a hypothesis about why a company could grow quickly. And your job is to figure out how to construct your hypothesis.
~How to Evaluate Startup Ideas by Ycombinator

How do you write good, strong hypotheses?

Identify your question. Before writing your hypotheses you need to identify the question (or questions) you want to investigate.
Make your hypothesis testable. You need to be able to somehow measure the results so you can disprove or prove the theory. Also, your test should be replicable, if necessary.
Phrase the hypotheses clearly and simply. Your grandma should understand the hypotheses if she reads them. Of course this is not always possible, but you get the idea.
Write statements, not questions. You are stating your assumptions, not asking questions about the project.

What are tools for idea validation?

Review of tools prepared by **Yash Gadiya**, Investor @ **Antler** → **Follow his Medium here**

#1 — Customer & User Interview

When to use it:
Very broad, can be initial fact-finding and understanding of just about any hypothesis validation

Do-s & Don’t-s:
- Don’t ask customers what they want
- Be aware of confirmation bias — especially if we are passionate
- Understand how representative of your persona is the person you are talking to
- Be aware of the simple size of too few interviews
- Be creative where to find people to interview (linkedin, reviews, personal network, etc…)

#2 — Shadowing

When to use it:
Broad, early-on use, most useful early-on to discover pain pain points. Later-on good for discovery of what works and what doesn’t with the product.

Do-s & Don’t-s:
- Document your observations
- Works B2B — observe people working & B2C — observe customer behaviour
- Don’t be too intrusive — you might alter the customer’s behavior
- Be creative and practice different shadowing techniques (in-store behavior, decision observation, physical interaction with the interface etc…)

#3 — Surveys

When to use it:
Mostly when you want to quantify a hypothesis. Such as what share of the target audience experience a specific pain points, or what the demographics of an audience look like.

Do-s & Don’t-s:
- Include demographic questions to gather information on the customer profile
- Ask about similar products/brands
- To test willingness to pay — check out using the Van Westendorp method
- Be aware of the size of the sample size before jumping to conclusions. Understand causation vs correlation.

#4— Focus Groups

When to use it:
To validate specific aspects of your solution

Do-s & Don’t-s:
- Set a clear goal for the session and focus on a single issue
- Be selective on the participants to make sure they fit your relevant target audience
- Make sure the participants don’t know each other
- Avoid leading questions (E.g: don’t you think that …) and keep it simple
- Have at least 2 people to lead the focus group (a moderator and a note taker)

#5 — Click Dummies

When to use it:
Non-functional preliminary stage of a prototype to test usability at an early stage. Used to gather constructive user feedback on the interface and interaction of an application and observe value of product “in action”

Do-s & Don’t-s:
- Keep it simple to focus on the essential of what you want to validate
- Feature relevant characteristics of your future product
- Setup implementation to simulate interactions and processes so that users can make statements to them
- Use slides, wireframes, sketch, many available tools

#6 — Non-functional physical Prototyping

When to use it:
Quickly visualize basic concepts at an early stage and test them for possible usability problems. Works for physical & software products.

Do-s & Don’t-s:
- Determine the original state and problem definition
- Sketch the main layout along with basic elements and shapes
- Create a storyboard / vision in case you are testing multiple frames of a potential app/landing page experience
- Test multiple iterations of paper models to quickly validate/invalidate micro hypotheses

Read more about it:
- The ultimate guide to prototyping
- Paper prototyping
- Rapid prototyping

#7 — Functional Prototypes

When to use it:
Constantly, after you have validated the basics. Many founders jump into building the final product too quickly.

Do-s & Don’t-s:
- Be fast & only solve the important user-facing parts. Scalability is bad
- Take the easy way (Low-Code/No-Code, Platforms eg wordpress, shopify)
- Define what success looks like upfront

Read more about it:
- Don’t serve pizza burnt
- Minimum delightful product

#8 — Landing Page Tests / Smoke Tests

When to use it:
Classically to test user acquisition or initial interest in the audience. Can also be used for testing a particular feature or even test willingness to pay

Do-s & Don’t-s:
- Include a clear call to action & keep it short and compelling
- Figure out how to bring what kind of traffic (beware of selection bias)
- Explain how your offering will ease the life of the consumer by building interest and appealing to the needs of your end customer
- Be very deliberate in what you want to test and what you define as success or conversion. Could be sign-ups, conversions, clicks, etc…
- You can use this to fake-test something you don’t have

#9 — A/B Tests

Pretty useless at this stage!

Is my idea validated already? How strong is the proof?

The closer outcomes are to the paying customer — the stronger the validation.

At the end of the day, it should be emphasized that potential customers who “walk the walk” are much more crucial than those who just talk of their preferences without committing to a product which is very well captured in Yash’s presentation putting various degrees of certainty to the research signals provided:

Thats it for today! If you want to start a tech startup in Poland but you are missing ideas, validation, or co-founders, apply to our community here and meet other ambitious individuals during face to face meetings in Warsaw!

Antler is the investor backing the world’s most driven founders, from day zero to greatness. Founded on the belief that people innovating is the key to building a better future, we partner with people across six continents to launch and scale high-potential startups that address meaningful opportunities and challenges. We bring together experienced operators, technologists and entrepreneurs to build their next companies. Our global community backs people from the beginning with co-founder matching, deep business model validation, initial capital, expansion support, and follow-on funding.

To learn more about what Antler offers or to apply to their next cohort please check out this link

Inovo Venture Partners backs early-stage, post-traction startups that can grow 100x. We partner up with ambitious founders like Stefan from Booksy, Maja from Zowie, or Marcin from Spacelift. We invest between €0.5–4m in startups from Poland and CEE region.