So you’ve got an awesome idea – congratulations! The next step is finding out whether it’s an idea that will work, whether there is demand, and whether you should take the next steps to making it a reality. In short, it’s time to validate your business idea.
My idea is amazing – why validate it?
Your idea might be the most original and exciting thing in the world, and you’re convinced people will love it. However, to succeed in business you need to prove this. Validating your business idea and establishing demand will be invaluable when it comes to winning investment, creating business plans, and talking to customers or suppliers. Validating your business idea also (hopefully) prevents you investing time in an idea that doesn’t have legs. It also enables you to investigate areas where you might run into difficulty.
Has it been done before?
The first thing you need to do is simple. Check that nobody else has already had this idea and put it into practice. Google, research, and see what your competitors are doing. If nobody has done it before, try and find out why. Have others tried, but failed? How can you avoid those mistakes? If people are doing similar things, this actually helps validate your idea, as it shows demand for your product or service. But be sure to think about how you can differentiate yourself.
Send out a survey
You can test the waters at first by sending a survey to friends, family and contacts that asks for honest feedback on your business idea. You can do this free with services such as SurveyMonkey. It’s a solid way to get some initial feedback on what people think about your idea.
Get a Minimum Viable Product
There’s no point sitting on a great idea. By building an MVP (Minimum Viable Product) – an early version of your product or service that isn’t perfect, but does the job – you can get testing on customers. With their feedback, you can develop your idea into something that matches the needs and wants of customers, as well as finding out vital information about price points.
Before even creating an MVP, you can start proving that people want your product by setting up a simple landing page, using a free service such as Striking.ly. Keep it simple, describe a little about your product, and leave a space for people to sign up. If you start getting many sign-ups, you know that you’re onto something.
By linking it with a Google Analytics account, you can also find out valuable information about where your customers are coming from, and their behaviour. And it means that, by the time you come to launch, you have a mailing list of people who are excited about your product ready for you to contact.
You need to create a business plan to get all of your ideas down on paper. This handy document can help to focus your efforts. It acts as a blueprint that will galvanise you into getting started. This can then be sent out to mentors, investors, friends and colleagues who can provide useful feedback on your idea.
You can download the Virgin StartUp business plan template for free here.
Crowdfunding isn’t just good for raising cash. It’s also the perfect indicator that people are willing to put their money where their mouth is, because they have already pledged to your idea. This validation is as valuable as the funding itself, and will help your business in future when it comes to raising more funding or building a business plan.
Want some more tips on nurturing your startup? Check out our startup guide in collaboration with Virgin StartUp here.