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How To Validate Your Startup Idea From 4 Companies That Did It Well

When you’re interested in starting a business one of the first words introduced into your entrepreneurial vocabulary is validation. Advisors want to drill that into your head. It’s like being a toddler, and your mom is trying to get you to say your first words and repeats it incessantly…

Muuumma…

Muuumma…

Say Muuumma…

Validation…

Say Va…li…da…tion…

Even though everyone hears those words, they’re fleeting. We “know” we’re supposed to validate our idea, but it’s not done properly by most businesses. 90% of startups fail, and that’s because they’re are building products that nobody wants!

They do all the typical “business stuff,”

Spend tons of money making the product

Get business cards

incorporate

all before they’ve made their first sale!

That’s because they did “surface level” validation.

“We did a survey, and people said they would buy this, VALIDATED!”

Not quite buddy, pay attention closely to my next point:  

Just because a few individuals said they’ll buy your product, that is NOT an indication that you have a winner on your hands.

I’ve experienced that situation first hand. We considered launching a new product, we polled our existing audience and got a resounding yes. We made it and expected to sit back and watch the sales roll in…but on the contrary; the sales were as empty as a nightclub on a Monday night.

We were confused…why would they ask for something but then not buy when we created it for them?

That’s when I realized that validation is MORE than people saying yes they want your product, it’s about them pulling out their wallets and buying it! What people say, and what people do are two different things.

Here’s how to validate your idea effectively:

  1. Survey your audience. If you don’t already have a big email list or following then ask your friends and family on your existing social media platforms.
  2. If they say yes, create a quick and dirty MVP to offer them.
  3. Get feedback, on why they did or didn’t buy.
  4. Get sales, then scale.

You have to ask people what they want, and the only way to test IS to create it, but the key is to spend as minimal time and money as possible at first. Create a quick and dirty solution to see if they’ll buy.

Here are a few companies that did it right:

Door Dash: A food delivery service, they put up a basic website to see if they would get orders. Once an order came in, they picked up the food and delivered it themselves. They did that for a while to test the idea, and until they could no longer handle the demand. Then they scaled. They didn’t hire a bunch of staff or have a fancy website. They got orders first and a lot of them until it was evident that there was a market for their services.

Airbnb: A service we all know and love, they allow people to provide hotel-like accommodations for travelers. The founders turned their home into a bed and bed & breakfast to make extra money. When people started to pay them, they realized they were on to something.

Homejoy: A home cleaning service. This company has since shut down, but was accepted into YC and did see success. Their issue was more business operations as opposed to a bad idea. Anyways, I love their validation story because the founder was super scrappy and put up Craigslist ads that offered cleaning services with a twist. When someone purchased, she went and cleaned the home herself!

Rich20Something: (shameless plug), a platform that provides online education for young people to maximize the most pivotal years of their life. We bootstrapped the business and have done over a million in revenue, without business cards, or a fancy website in the beginning. It started with listening to our audience and creating products that solve their problem.

No matter your idea, there’s a way to test it for viability without first investing tons of time and cash. Even If it’s an app/web based service, chances are it can be tested manually first. Consider building your product via Google docs, a basic WordPress site, or even going door to door. A yes isn’t enough criteria; the real criteria is if a customer pulls out their wallet and pay you.

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