When you have an idea for a new product or survey, it can be challenging to know what to do with it. Do you hold on to the idea, or immediately begin executing on it? In most cases, a hybrid approach is best. You want to test the idea without going all-in and wasting your resources.
How to Validate a Startup Idea
From the outside looking in, onlookers assume that entrepreneurs are crazy people that take incredible risks and hold their breath as they hope things work out. But if you dig in a little deeper and explore how successful entrepreneurs approach new ideas and business ventures, you’ll discover that they’re far more calculated and risk-averse than you think.
Savvy entrepreneurs understand the danger that comes with launching an idea with no market research or supporting evidence. Thus, they take the time to test and validate startup ideas before diving into the deep end.
Here are some of the specific ways they go about it:
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Conduct Surveys
While you may feel like you’ve identified a market need and developed an idea that can satisfy it, you’re only one person. If you aren’t careful, you’ll launch an entire business around your own subjective opinions without establishing any widespread market need.
What better way to validate a startup idea than to go straight to the people who would, presumably, be purchasing your products or paying for your services? Try creating a survey and sharing it with people on social media. Thanks to tools like Drag’n Survey, it’s as easy as plugging in some basic information and monitoring the responses as they flood in.
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Examine Data
It’s easy to get carried away with subjective insights and to develop an inaccurate view of reality. To truly validate an idea, you need as much objective information as possible. Thankfully, data is all around you.
Data can be mined from social media, websites, research studies, surveys, polls, and dozens of other sources. Be sure to include some data in your decision-making process.
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Implement Fake Door Testing
Experienced software developers and entrepreneurs often use something known as “fake door” testing to validate (or invalidate) an idea.
Fake door testing – also referred to as ghetto testing – is something Zynga games uses regularly. They create a five-word summary of a new game they’re considering and develop some ads to place on popular websites that intersect with their target market. They then study the analytics of these ads and only develop the ones that generate a certain number of clicks and engagement on the “fake door.
You may be able to implement a similar strategy. Simply create a landing page for your startup idea, pay for some ads that direct people to the landing page, and then study the results. If there’s enough interest, you may have a viable idea.
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Use Storyboard Testing
In some cases – particularly those involving a service (as opposed to a physical product) – storyboard testing is helpful. It involves developing a story, fleshing it out on a physical/virtual storyboard, and then hunting down target customers and striking up organic conversations in which you relay the story and ask for input.
Storyboard testing is ultimately about figuring out whether you have the story right. And if you do have the story right, it’s about validating whether your idea is practical and attractive to your target customer.
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Develop a Minimum Viable Product
Are you familiar with the idea of a minimum viable product (MVP)? It’s the process by which you create a product that addresses the core functionality without all the bells and whistles of the final product. By stripping away the superfluous, you’re able to keep costs low and focus on what matters. If the MVP is received well by your target customer, then you can proceed. If it flops, then ditch the idea.
Take Calculated Risks
Launching a startup isn’t about taking on inordinate amounts of risk. It’s also not about avoiding risk altogether. Instead, you should be making calculated decisions that are low-risk, high-reward in nature. Using some of the validation methods outlined in this article, you can modify your approach to startup ideas and improve your ROI.
