The idea is what stands at the beginning of every entrepreneur’s journey. Great ideas, however, rarely fall from heaven. Most often, they are the result of a long (and sometimes tedious) process. We talked to serial entrepreneur Christian Hirsig (fmr. founder & CEO Atizo, Founder Powercoders) about the DOs and DON’Ts of idea testing to make sure you are starting off your journey on the right foot.
Christian’s five DOs and DON’Ts:
Let’s have a closer look at them. You can listen to the full interview with Christian here.
Building your own company is a marathon, not a sprint. Or maybe more a triathlon, because it requires a variety of different skills. So when you look at your idea, ask yourself: what are the jobs and skills that will be needed to make this a success? If for example, you build a b2b product or service that requires you to do a lot of direct sales but the idea of going from door to door selling your product makes you yawn already, then you likely won’t be able to muster the perseverance to see your idea through to success.
It might be tempting to hide your idea from others, either because you are afraid to be copied or because you don’t want to present people with something that is not “cooked through” yet. For you to gauge whether your idea has a chance of getting traction, it is important to talk to your stakeholders early on. Formulate your hypothesis with regards to the different stakeholders. For example: “Company X would offer an internship to a refugee if they have a certificate of their skills.” Once you test your hypothesis by talking to the stakeholders, be sure to always ask “WHY”: Why would (or wouldn’t) company X offer an internship to a refugee? By asking WHY you understand what drives your stakeholders’ decisions which can help you to improve your product, story or business model.
Don’t spend hours on end improving your pitch deck. By talking to others about your idea first, you will be able to gain a lot more clarity about what works and what doesn’t. Start with your friends and family but keep in mind that their feedback might be biased. Then move on to focus groups with your stakeholders (customers, suppliers, partners, employees, etc.). Once you have gained an understanding of how your idea is perceived, have a first go at your deck.
MVPs (minimum viable product) are a great way to take your hypothesis testing to the next level. When working with MVPs, it is crucial to understand what they are and more importantly, what they are not. An MVP is a way to test a hypothesis underlying your product or service. It is not part of the final product or service. It is a common misconception that an MVP is just an unfinished, inferior version of your final product, when really, it is something entirely different. For example, if you wanted to find out whether a Portuguese restaurant could gain traction in your city, you don’t open up a restaurant with cheap furniture, serving Portuguese dishes with low-quality ingredients. Instead, you could get a stall at your local farmers market and offer a few of your planned dishes in the original quality to market-goers. This will help you determine whether your hypothesis “People in my city are interested in eating Portuguese cuisine” is true.
Establish clear KPIs (Key Performance Indicators) with which you are going to judge the performance of your MVP. This could, for example, be: signed LOIs (Letter of Intent) if your product or service is b2b or the conversion from a social ad to your landing page if you are b2c. We will cover the Art of Measuring more in-depth in upcoming episodes.
Do you have questions or comments about Christian’s DOs and DON’T of idea testing? Get in touch with us via Facebook or write us an email at firstname.lastname@example.org.