Table of Contents
Last updated on March 4, 2021 by Hong Zhuang Reading Time:22 min
Why are you here?
Has your idea consumed your mind and driven your everyday life so much so that you must find out if you have the right tech idea to launch a tech startup that will be funded by pre-seed or seed investors?
Did you answer “Yes”? Then you are in the right place. Otherwise, save yourself some time and skip this guide because you are not ready for beginning a tech start-up. Not yet. Maybe later.
You might feel baffled for how to validate your idea. Okay. We understand that problem. Validation is often difficult because…
- You likely feel your idea is your baby, and the validating process will challenge your love for that baby.
- Since the validation process depends on your idea, it can be challenging for any new entrepreneur to select the best process.
- Even when you select that right process, your bias can negatively impact your validation result, especially if you’ve been waiting for that special light bulb moment for years.
Luckily, that’s what you’ll learn in this guide. You are in the right place. We’ll help you understand why you need to consider the founder fit. You’ll discover what specific actionable steps you can take to complete a successful validation of your idea.
Keep reading to learn more, or use the chapter links below to jump ahead.
What is idea validation about?
It is about confirming two elements:
- Founder market fit: Before the Google Search engine, there were many other search engines. Before Facebook, there was Myspace. Every one can have an idea, but to succeed, you have to be precisely the right person to build your idea(i.e., founder market fit)
- Idea validation: Will your idea actually resolve a real urgent problem for your customers? If you say “yes”, will enough people buy into your solution? In other words, do you have an excellent idea for a viable business in a market that has enough potential for large growth?
Validate Your Startup Idea on a Napkin
What are you going to validate? It should contain the following 2 elements:
- Founder market fit:
- Passion
- Competency
- Idea Worthiness
If your idea lacks any one of the elements, it will ruin your chances of success. Why? Let’s review how you can assess the above elements using a three-step startup idea validation process.
How to Validate Your Startup Idea on a Napkin?
- Do I have a passion for my startup idea?
- Can I execute the idea and deliver the desired results successfully?
- Does my idea solve a big business problem from my personal experience?
Step 1:Do I have a passion for my startup idea?
Why is passion necessary?
- you have probably heard thousands of times “do what you love and success and money will follow.” According to one study, 17% of startups fail because the founder lacked passion.
- life as an entrepreneur is extremely difficult, especially in the beginning. You know Airbnb, right? For the first 2 years, with no investors and a few customers, the founders lived on credit cards and sold cereals to keep the company afloat. When you suffer constant awkward, negative energy will consume you. And you, like every entrepreneur, will attempt to give up your startup. Passion, like a lifeboat, will be your positive energy to inspire you, give you courage, and drive you forward to your goal.
- since pre-seed investors care about founders more than ideas, passion is one of the criteria they pay attention to.
Do you know your passion?
If so, you can check if you have a passion for the idea and skip the rest of this section.
Otherwise, you probably are still searching. Where have you been searching?
Have you looked at your book collection, magazines and website bookmarks? What subjects have you been spending your time and money on? Make a list and see if your idea is among the subjects.
Passion lives deep in your heart. This is why you can’t find it using your head.
How do you connect your passion to you heart?
Use this self-assessment technique below. In order to achieve the desired results, follow the process precisely.
- Find a quiet room for yourself
- Close your eyes, and ask yourself “What would I do if I had all the money, resources, skills, time and energy, and could never fail?”
- Let your mind wonder and get lost in your thoughts.
- Open your mind and write down on paper napkin the first 10 things that appear in your mind.
- Check if your idea is on the list.
- If yes, it means that you have a passion for the idea.
Why does this exercise reveal your passion?
Many psychology studies show that as we grow older, we stop following our heart our heart because of fears, self-defeating beliefs and assumptions such as “I must not make a mistake because people will think I am stupid.” We only think about our dream life when we buy a lottery ticket. Like lottery tickets, this exercise sets you free from the real world and connects you to your heart. As a result, you came up with a bucket list. How many times have you made a choice that went against your heart, and then later regretted it? I can’t tell you how many people reconsidered their career paths after completing this exercise.
Step 2: Can I execute the idea and deliver the desired results successfully?
You probably know Warren Buffet, the legendary stock investor in the US. He has beaten the S&P 500 index for decades. What is his secret sauce to succeeding? Circle of competency. Here’s Warren Buffett in his own words:
What an investor needs is the ability to correctly evaluate selected businesses. Note that word “selected”: You don’t have to be an expert on every company, or even many. You only have to be able to evaluate companies within your circle of competence. The size of that circle is not very important; knowing its boundaries, however, is vital.“
Warren Buffett
In other word, it is an area where your skills, expertise and experience are strong. It is your edge. For every investment, Warren Buffet ensures that he is familiar with the businesses and whose owners focus on their circle of competency to lead the company to success.
Why is the circle of competency necessary?
It protects you from making major mistakes that will destroy your chance for success.
- starting a business is like entering a war zone. Knowing your circle of competency is a must. As the greatest Chinese army strategist, the author of the Art of War said “If you know the enemy and know yourself, you need not fear the result of a hundred battles. If you know yourself but not the enemy, for every victory gained you will also suffer a defeat. If you know neither the enemy nor yourself, you will succumb in every battle.”
- as Sue Grafton said” Ideas are easy. It’s the execution of ideas that really separates the sheep from the goats.” You must know what makes you to execute your idea successfully in a timely manner?
- pre-seed investors only invest in startup whose founders focus on the circle of competency to lead the startups success.
what is in your circle of competency that matters to your startup success?
- imagine that you have an idea of a beautiful house. Now, you need an architect to convert your idea into a blueprint and a general contactor and many subcontractors and workers to build your house based on the blueprint. In order to turn your idea into a product/service, do you have expertise, experience and tech know how to design your system blueprint and convert your design blueprint into a product/service that your customer will love and stands out from your competitors?
- there is more than simply building a house. You need to buy a lot, get building permits from local government, buy insurance, obtain a construction loan, and so on. Do you have industry experience and expertise to make your product/services fits and works in its ecosystem effectively? For example, if most of your customers were using mySQL database, they would not buy your app using Oracle database.
- if your idea is within your circle of competency, you will save yourself valuable time and money to avoid reinvent the wheel, and find product market fit faster.
What if you lack some of skills, experience or expertise?
One effective way is to find a co-founder or recruit subject matter expert as your advisor.
Step 3: Does the idea resolve a big business problem from my personal experience?
Why is the answer for this question is necessary?
- if your idea doesn’t resolve any problem, it will not be worth pursuing because people will buy your product or service only if they can solve their problems. Do you remember the Google Glass? It never clearly defined what problems it would solve for its customers. The creator just assumed that people would like to have glasses combining a fashionable style with functions that Google offered. The result: no one wanted them.
- When you have a personal connection to the problem, you will avoid the number one entrepreneurs’ mistake, which causes 42 % startup failing. It is that they built a product/service that did not solve their customers problems. You greatly increase your odds of success.
- the first thing pre-seed investors look at is the level of founders’ unique insights to their problems. When you have a unique insight to the problem, you will likely develop a unique solution, outrunning your competition and avoiding the number three entrepreneurs’ mistake—getting outcompeted. Taking Uber as an example, the unique insight was the inconvenience of the taxi services including taxi availability, cash payments, and unfamiliar routes of drivers. Its solution is an app that connects customers with drivers easily, uses GPS to guide drivers, and processes the credit card payment.
How to find if your problem is big?
1) answer 4 questions on paper napkin
Let’s get your paper napkin and pen, and write answers for the following 4 questions because writing will help you understand your problem more deeply.
Does your startup idea solve any real problem? People will buy your product or service only if it can solve their problems. For example, you go to McDonald’s when you are either hungry or thirsty.
Is this problem from your personal experience? If not, I would suggest that you take a step back and make sure you understand the problem in depth. Why? “If you define the problem correctly, you almost have the solution,” as Steve Job said.
If yes, how urgent is the problem? If your potential customers can live with a nonurgent problem (e.g., a mosquito bite), they would not be willing to pay your product or service, and you would not have a viable business.
Otherwise, an urgent problem, what are switching costs? Even though your problem is urgent, it will not guarantee success if the switching costs are high.
Do you still think your idea is good? Yes? Let’s move on.
2) find out your startup idea’s market size
At this stage, you only need to do a rough calculation of the market size.
If your idea targets a B2C market, you can find how many potential customers exist by sex and age are in the market ( forget about your competitor for now), and then multiply by the estimated service charge. To help you do the calculation, the table below lists the US population by age and sex coming from the US government census data.
| Age | Male | Female |
| Total | 161,657,324 | 166,582,199 |
| .Under 5 years | 10,009,207 | 9,567,476 |
| .5 to 9 years | 10,322,762 | 9,873,133 |
| .10 to 14 years | 10,618,261 | 10,180,007 |
| .15 to 19 years | 10,745,607 | 10,308,963 |
| .20 to 24 years | 11,064,752 | 10,568,188 |
| .25 to 29 years | 12,004,570 | 11,504,446 |
| .30 to 34 years | 11,354,610 | 11,076,695 |
| .35 to 39 years | 10,884,941 | 10,852,580 |
| .40 to 44 years | 9,907,139 | 10,014,484 |
| .45 to 49 years | 10,085,355 | 10,312,396 |
| .50 to 54 years | 10,086,611 | 10,390,540 |
| .55 to 59 years | 10,642,489 | 11,234,902 |
| .60 to 64 years | 9,856,730 | 10,714,416 |
| .65 to 69 years | 8,199,773 | 9,255,228 |
| .70 to 74 years | 6,499,806 | 7,528,626 |
| .75 to 79 years | 4,318,499 | 5,334,166 |
| .80 to 84 years | 2,679,724 | 3,637,483 |
| .85 years and over | 2,376,488 | 4,228,470 |
For example, you have a product or service that can be used for women between 65 and 69. Assume that only half of the population will use your service and your service charge is $5 per time,
| Annual service usage frequency | Population | Total potential market size | Fundable idea? |
| 1 | 4,627,614 | 23 million | No |
| 10 | 4,627,614 | 230 million | Yes |
But, if your idea targets a B2B market, you can do a quick Google search using a search phrase like “how many”+ your b2b companies+“ in the US”. For example, if your idea is about serving law firm, your search phrase should be “how many law firms in the us?” Your search result will return 1,352,027 as 2019. Thus your annual service fee must be at $200 in order to be fundable.
Wow, You have finished the founder market fit validation! How are you doing? Do you still want to conduct a comprehensive idea validation?
Did you answer “Yes?” Congratulations!
What Should an Idea Validation Cover?
According to Steve Blank, author of The Four Steps to the Epiphany, there are three types of markets:
- New market
- Niche market
- Existing market
Startup ideas creating new markets either create a new way of doing business (e.g., Uber) or disruptive technologies like Bitcoin.
Startup ideas with niche markets tweak existing products or business models to different customer segments (e.g., Etsy selling handmade goods, art, collectibles and antiques).
Startup ideas for existing markets reconfigure the existing products/services to make them better (e.g., Google search engine).
Given the differences in start-up types, you must know what your idea validation should cover. The table below provides a general guide.
| Market Validation | Customer Validation | Solution Validation | |
| Startup ideas creating new markets | Yes | Yes | No |
| Startup ideas focusing on niche markets | Yes | Yes | No |
| Start-up ideas for existing markets | Yes | Yes | Yes |
Why don’t start-up ideas creating new or niche markets do solution validation?
Their solutions cannot be validated before they educate their potential customers. Henry Ford, the Ford company’s founder, said,
If I had asked people what they wanted, they would have said faster horses.”
Henry Ford
If that sounds foreign to you, don’t worry; That confusion is common to first-timers, and we’ll guide you through the validation process.
Step #1 Minimize Confirmation Bias
According to the psychological definition, confirmation bias is “the tendency to process information by looking for, or interpreting, information that is consistent with one’s existing beliefs.” It is oftentimes an unconscious act
Why do you need to minimize confirmation bias?
For customer validation, confirmation bias will prevent you from getting your potential customers’ feedback objectively. For example, you believe that manufactures should replace Microsoft Excel because it can’t provide live insights. When you talk to them, you will focus on the importance of live insights and ignore whether your potential customers want to resolve it.
This bias can make the solution validation fruitless. When gathering feedback, many tech founders focus on their technology supreme and neglect buyer’s concerns. For instance, you have a cloud migration product that can migrate data to any cloud computing platform. But your product will not be sold if it cannot address the common migration fear of losing control, security, privacy and data protection.
How do you overcome this bias?
Psychologists have suggested:
- Be aware that all your beliefs on your startup idea are assumptions.
- Look for instances to prove you are wrong.
- Listen objectively to understand what customers’ biggest challenge is.
- Ask general questions before asking questions related to the problem or solution.
Although you can never 100% eliminate the confirmation bias, bias awareness will help you listen to your customers more objectively and collect more accurate feedback.
Step #2 Market Validation
What should market validation cover?
- check if your market is growing or languishing?
- confirm if you have any competitors?
Why does market matters?
American entrepreneur and investor Marc Andreessen summarized that the key to startup success is market, saying,
When a great team meets a lousy market, market wins.
When a lousy team meets a great market, market wins.
When a great team meets a great market, something special happens.”
Marc Andreessen
Market in the startup world is like location in real estate. A good market is like a rising tide that lifts all boats, greatly increasing your chance of success.
what are characteristics of a good market?
- demand is much greater than supply.
- customers want your products urgently, and will not care about whether you have a perfect product (e.g., Zoom).
To save your time, we list pre-seed and seed investors’ favorite hot technologies and industries.
Technologies:
- Artificial intelligence
- Blockchain technology
- Energy storage
- DNA sequencing
- Robotics
- Cloud technology
Industries:
- Cyber security
- Wellness
- Healthcare
- CleanTech
- Finance
- Agriculture
- Insurance
- Education
- Productivity and collaboration for remote work
- pet industry
Why should you confirm if you have any competitors?
For startup ideas creating new or niche markets, you need to confirm your assumption that no competition is true.
For startup ideas for existing markets, you need to confirm your assumption that no other companies have solved your problem.
Where do you find your competitors?
- Google: competitor names, websites
- Owler.com: competitor revenues
- Crunchbase.com: possible startup competitors that recently got funded by pre-seed and seed investors
What info will you gather?
- Company info: name and revenue. A big company might solve your problem faster because of their abundant resources.
- Product info: features. To ensure that nobody else solved your problem.
- Targeted customers, location and demographics: to confirm that you are the only one serving your targeted markets.
How to store your competitor info?
Create a table with the following column names:
- company name
- company size
- product features
- targeted customer segments
- targeted customer locations.
How can you gather information?
- Go to www.google.com.
- Type your product keyword and be specific, such as: “ insurance claims fraud AI detection software.”
- Type all company names into your table.
- Go to https://www.owler.com/company to find company revenue one by one. Here is SAS company detail:
- Type revenue into your table.
- Go to each website of the companies in your table, find features, targeted customers and locations. You also search the FAQs or knowledge bases to see if your problem is listed and how it has been addressed. you may place a hold on your customer research in case that the company plans to fix your problem,.
- Goto https://www.crunchbase.com/discover/funding_rounds, and check pre-seed box, you will see a list companies, then click each company.
Step #3 Customer Validation
What Should Customer Validation Cover?
- To understand your problem from your potential customers’ point of view.
- Confirm your assumption that customers suffer your problem. If not true, no one will buy your product or service.
- Check your assumption that your problem is urgent. If not true, no one will be willing to buy your product.
How to conduct your customer validation?
- create detailed customer persona and decide where to find them. The table below suggests places where you can find your potential customers. You can add other sources as needed.
| Customer Type | Where to find customers |
| Business-to-Consumer | Startup ideas creating new or niche markets: Facebook. Startup ideas for exiting markets: the competitors’ product community, Quora, Facebook. |
| Business-to-Business | Startup ideas creating new or niche markets: LinkedIn. Startup ideas for exiting markets: the competitors’ product community, LinkedIn. |
2. develop customer interview questions that will minimize confirmation bias. We have suggested some general and specific questions for your reference.
| General | All startup ideas | Validating your assumption that your product will address the biggest challenge for your potential customers. Yes, your assumption is true. | What are big challenges you face? OR What is your top priority for next 12 months? |
| Specific | Startup ideas for existing markets | Validating your assumption of product problems. | What are good and bad things about this existing product? |
Behavioral psychology studies have showed that when a product has been regularly used it becomes part of a user’s habit. As a result, it will be difficult for them to switch to a new product. For example, you might wish you had a better phone. But will you want to replace it with one from a different brand? Most likely not because of the hassle of switching a phone. Thus, you need to add some specific questions of the hassles and concerns of switching.
3. Conducting Your Customer Validation.
Two common mistakes you should avoid:
a. talking to family or friends. But it is wrong.
Why?
- Family or friends might not be your ideal customers.
- they don’t have business experience to judge the viability of your business.
- they are biased because they love you and don’t want to curb your enthusiasm.
My client came up with an idea when he saw his mother-in law use a daily diabetic test kit. He believed that it was expensive for people without health insurance to buy the kits. So, he decided to build an online business to sell cheap diabetic test kits. Her mother-in-law and wife agreed that it would be a lucrative business idea. But I found that uninsured patients have been buying the unused kits from Medicare recipients who received too many diabetic test kit.
b. You might have heard of other validation techniques such as conducting a survey or talking to potential customers.
Will they be reliable?
When we answer a question, we use a conscious mind and think about what we ought to say and do. But a Harvard study showed that 95% of buying decisions we make are from the unconscious mind. From a survey, a famous food company was convinced that old people liked food similar to baby food because of rich nutrition and goodness for their aging mouths. But it had to stop the product line a year later because old people didn’t want to feel old.
How to get your potential customers’ feedback using LinkedIn?
- How do you get a list of your potential customers?
- For the existing market, you can find the salespeople profiles for the existing product. Then identify their customer connections to the people who are likely the decision makers in those companies. Now you have a list.
- For a new or niche market, you can use LinkedIn Sales Navigator to identify potential companies, and then loop through one by one to find decision makers. Now you have a list.
- How do get feedback?
- To confirm your assumption of urgent problem. You can send cold emails to decision makers and ask them for the insights for your market research report. Your assumption is confirmed only if your problem is on their top big challenge list.
For Business-to-Customer companies:
- If you haven’t joined a related Facebook group, joining one will help you understand your potential customers’ needs.
- Startup ideas for existing markets can post product specific questions on Quora to check if the answers agree with your assumptions of the product problems and urgency.
Step #4 Make a Right Decision
Now you know your market and customer feedback. What data tells you?
Market condition | Competitors | Customer problem review | worth doing an MVP | |
| Start-up ideas creating markets or niche markets | Good | No | Yes | Yes |
| Startup ideas for existing markets | Good | A few | Yes | Wait until you finish your solution validation |
| Start-up ideas creating markets or niche markets | Bad | No | No | Your company will have a tough time attracting investors |
| Startup ideas for existing markets | Bad | A few or Many | Yes or No | Your company will have a tough time engaging customers and attracting investors |
If your startup idea is for creating markets or niche markets, you have just finished your idea validation!
We hope this guide helps you validate your idea easier, and most importantly, save you time and effort to continue your solution validation if the validation result is not what you expected.
If your startup idea is for existing markets, and you want to finish the entire idea validation, keep reading!
Step #5: Solution Validation
What should solution validation cover?
Making an Minimum Viable Product (MVP) and testing it, right? No, forget about landing page or MVP or prototype.
Why?
We don’t recommend you implement an MVP or landing page for these reasons:
- Developing an MVP is unnecessary. It is especially true for business-to-business applications where your users have no purchasing decision power even though they might like your solution.
- If you are not a search engine optimization (SEO) expert, a landing page is not an effective way to test your solution. Why? because it heavily depends on keywords you have selected. Without the right keywords, your potential customers will never see it.
- Landing pages demand a lot of your time, and there is a learning curve:
- naming your business
- finding an available domain name
- registering a web domain
- signing up for a landing page platform
- identifying keywords for your landing page
- creating a landing page
In the end, you waste a lot of time, effort and money if you decide to abandon your idea.
If you are a technical founder, you might feel this approach quite foreign because you always start with a technology idea, and then find a real business case to fit it. We hope Steve Jobs’ talk will help you understand why you need to change your mindset if you want to become a successful entrepreneur.
What should an effective solution validation cover?
- Designing a unique virtual solution.
- Testing your virtual solution with the least effort.
- Interpreting your validation data.
How to conduct a solution validation without MVP or Landing Page
Step #1: Find barriers to entering a market to start your startup
Why do you care about barriers?
Although you have a great idea, you might not be able to afford the cost of a start-up .
What are barriers you must identify?
- Government policies or regulations or licenses: For example, you have an AI product monitoring COVID patients. Doctors will not be able to use it unless it has been approved by the U.S. Food and Drug Administration. Here is a list of highly regulated industries in the U.S.:
- Telecommunications
- Healthcare and life sciences
- Railroad, airline, and pipeline transportation
- Oil and gas
- Electric power and transmission
- Financial services and trading
If your start-up idea is in one of the above industries, we would suggest that you pause your solution validation, and research the regulations because your potential customers might not be willing to participate in your solution validation.
2. Your potential customer switching costs: If you don’t know the answer, you need to talk to your potential users. If the costs are high, your solution will not attract them.
3. Technology adoption: If you are using blockchain, you will have hard time finding customers for the next few years. For example, in the early days of Java, only a few companies used Java-related products because
- they were hard to integrate into a system
- only a few talented Java programmers were available
Step# 2: Analyze your competitive landscape
What is a competitive landscape?
According to the dictionary, “A competitive landscape is a complete description of competitors and their relative position at a particular market.”
Why does your competitive landscape matter to you?
Your market will be like a dog-eat-dog world, and your product might die in infancy.
How can you avoid that?
Differentiation, meaning that you stand out from your competitors. Animals use camouflage to avoid predators. You use differentiation to avoid competitors and stand out to attract potential customers.
How to find differentiation?
- Recognize the benefits your competitors’ products offer. Create a competitor benefit table as shown below listing all competitors’ segments and benefits one by one.
| Competitor’s Name | Segment (B2B: company size, B2C: users’ demographics ) | benefit 1 | benefit 2 | benefit 3 |
For example, if your idea is to develop a relational database cloud service for mid-sized companies using the Unix system, your table would include competitors such as Oracle, IBM, Microsoft, and mySQL as in Part 1 of this guide. Enter the information for each of them, and fill your competitor benefit table.
As an example, the table below represents Oracle: Database 19c and 21c | Oracle.
| Competitor’s Name | Segment (B2B: ) | benefit 1 | benefit 2 | benefit 3 | Benefit 4 |
| Oracle | mid-size companies | Reduce operational costs by up to 90% | Guard against data breaches | Use a single database for all data types | Deploy where needed |
- Identify benefits that are not listed because they will become your differentiation. For our database example, you can claim your product is an AI cloud database without the need for a database administrator for non-tech business.
Step# 3: Redesign your solution
why you need to redesign a virtual solution because you have one already?
Your solution is like a tree you planted, but you don’t know whether it will grow in your designated environment, i.e. your competitive market. This why you need to redesign your solution to incorporate the differentiation you found in the previous step.
We don’t recommend focusing on features because your potential customers only care about benefits. For example, when you sign up with Zoom for virtual meetings, you never check its features, and just care how it helps you have virtual meetings with your friends or co-workers.
We also don’t recommend you implement an MVP or landing page for these reasons:
- Developing an MVP is unnecessary. It is especially true for business-to-business applications where your users have no purchasing decision power even though they might like your solution.
- If you are not a search engine optimization (SEO) expert, a landing page is not an effective way to test your solution. Why? because it heavily depends on keywords you have selected. Without the right keywords, your potential customers will never see it.
- Landing pages demand a lot of your time, and there is a learning curve:
- naming your business
- finding an available domain name
- registering a web domain
- signing up for a landing page platform
- identifying keywords for your landing page
- creating a landing page
In the end, you waste a lot of time, effort and money if you decide to abandon your idea.
What is a better way to show your solution to potential customers?
Nathan Furr, the author of “Nail It Then Scale It,” suggested that a sales pitch formula for your solution, including the following:
- Which industry does your product serve?
- What is the problem you are trying to solve and for whom?
- What is your product’s name and category?
- Why should your potential customers buy your product?
- Benefits
- Differentiation
In order to help you understand what a sales pitch looks like, let’s create the sales pitch for the example of the database for the non-tech companies in the previous step, assuming that its company is called NontechDatase, and its name is CloudDatabas:
(1) NontechDatase provides a cloud database to mid-sized companies that (2) look for an effective and reliable database operation without developers and administrators so that they can save costs in hiring and focus on their core business functions.(3) CloudDatabase is your ideal database. (4) Unlike all other commercial databases such as Oracle and Microsoft, CloudDatabase AI performs like a senior database administrator and developer, and will manage your database and conduct all database developer’s tasks 24/7.
Can you try to write your sales pitch now?
Step# 4: Test your solution with the least effort
Now that you have your sales pitch, how do you test it? The table below is a suggested guide:
| Approach to Testing Your Solution | |
| Business-to-business market | Use your list of decision makers you created in Part 2 of this guide, and send the sales pitch you created in the previous step though LinkedIn Inmail to each of them. If you receive 50% or more responses, you found a market for your solution. |
| Business-to-Consumer market | If you used Quora for your customer validation in Part 2 of this guide, you can post a question about your solution and ask if your solution benefits are appealing. |
| Business-to-Consumer market | If you used Facebook for your customer validation, you can contact people who provided feedback and ask for their feedback to your sales pitch. |
Here is a Linkedin InMail example for NontechDabase. You can simply revise it.
Dear [prospect],
Managing a database operation can be a big undertaking for a non-tech company like yours. Our CloudDatabase, AI-based database performs like a senior database administrator and developer, and will manage your database and conduct all database developer’s tasks 24/7.
CloudDatabase will save the cost of hiring an expensive database administrator while providing you with the security, efficiency and reliability you deserve. Thus, you can focus on your core business functions.
Some of our potential clients [X,Y,Z] are highly interested in our product. If you want to hear more about our product and benefits, contact me and we can discuss. If not, do you know if there someone else who might be interested?
Thank you
(Your name)
Let’s finish your sales pitch, and see how your potential customers will respond to your solution.
Step# 5: Interpret your validation data
Once you have your solution feedback data, let look at the data and decide if your start-up idea is worth getting into the market.
| Barrier to entry | Customer loves your solution benefits | Worth | |
| Business- to-Business market | High | High | More search on barriers |
| Business- to-Business market | Low | High | Creating an MVP with most wanted benefit your potential decision makers suggested |
| Business-to-Consumer market | Low | High | Creating an MVP with most wanted benefit your potential customers suggested |
| Business- to-Business market | High | Low | Abandoning your idea |
| Business-to-Consumer market | Low | Low | Abandoning your idea |
Do you have enough information to make your decision?
Conclusion
This blog, a part of a validation series, concludes the series. My clients have used this validation process and found it to be effective. We hope that the validation series help you decide if your idea is good enough for your startup, and save a lot of your valuable time and effort without spending any money.