I have a startup idea. What’s next?
Today, many people think of starting a startup. In fact, like any business endeavor, a startup is ambitious, challenging and risky.
Get ready, there is a long road ahead. Or a short one, if you fail.
Startup development process is divided into stages. The article will provide you with to-do actions on each stage. Just in case, this is not an ultimate startup development guide that will for sure transfer your idea into a profitable business, nevertheless, it reflects the most common way founders create startups nowadays.
For whom the article is? – The article is for newbie startup founders who might have some experience working in an IT service company.
Who is the author? Does he have enough expertise to write about it? – The author is Artur Prokopchyk, founder and a product manager of 3 startups of different stages, mentor for local startup founders-newcomers.
Stage 1. Startup Idea Validation
Startup idea – desk research validation
So, you have a startup idea. The task is to know how you can build a business from the idea, – the stage of its validation has begun. To pass the stage, you should carry out some simple, but important desk research. The actions are the following:
- Startup idea validation through Business Model Canvas. This is a document where you should answer questions about the product you want to create. No wonder this document is called a business plan in 20 minutes. Filling in this document will provide you with a good understanding of the aspects of your product:
- Target audience and early adopters;
- What problems, pains do potential user of your product have;
- How the problem is solved today, without your product;
- High-level description that explains your product in 2-5 words;
- Unique Value Proposition;
- Business model, revenue streams and other.
- Analysis of existing solutions. After you have a complete understanding of what you are going to create, there is a task to find and analyze existing solutions. In marketing, it is also called competitive analysis. Who are potential competitors, what solutions do they offer, what solutions do they not offer in comparison to yours one, their market share and so on. Do not forget to check similar startups’ success stories – how did they start, how they validated ideas, what offer do they have now, who are their clients. Execution of this point may be combined with the 1st and done in parallel.
- Find and examine similar startups’ failed stories. The problem is that founders and product managers pay a lot of attention to success stories and do not examine failed startup stories at all. This is a so-called survivorship bias. Here we have a great research on why failed startup stories are worth learning LINK. You can get many valuable insights if you manage to find a failed startup story and define what went wrong. This will let you avoid mistakes that led other startups to failure.
- Find more information about the industry of your potential startup idea. Do analytical agencies predict its growth in upcoming years? For example, starting a blockchain startup is probably a great idea, but there is no more hype around it.
- Bonus task: to fill in the so-called Guy Kawasaki pitch deck template. This is a presentation template that is similar to Business Model Canvas, but has a couple of additional questions. As a result, you will have a presentation that you can show at a startup conference: investors and experts will like your presentation and pitch if you did the research properly.
Check the Product development tips article to know even more startup development advise.
Completion of the startup idea desk research validation checklist
Now, when desk research is over, it’s time to have a look at what you achieved. Let’s reflect the results in the form of a list with aspects of the desk research.
Startup idea comprehensiveness
- The idea is unique.
- There is a potential target audience for the startup.
- There is an Early Adopters segment in the target audience.
- The Early Adopters are reachable via some channels.
- There is a problem/pain the startup’s idea is expected to address.
- Existing solutions do not meet users’ needs.
- Unique Value Proposition is defined.
- High-level description of the future product is indicated.
- Founder(s) understand the target industry.
- Business model is clear.
- Potential revenue streams are clear.
- Expected Expenses are clear.
- Everything mentioned above is not fantasy, because it is confirmed with the research.
- You are not the only person who needs this solution and it is confirmed by the research.
Well, having all “Yes” is great, but a couple “No” doesn’t mean that you should stop building a startup around your idea.
In fact, after the successful completion of the mentioned steps and if your startup idea is connected to B2C, you can try to do some “field” tests. Have a look at the recent article on Forbes writtent by our CBDO – Ms. Yulia Koroleva – where a simple startup idea test approach is explained.
Anyway, not all startups should go and create a website and invest in ads. Usually, next startup development stage is Customer Development, which is required for B2B, some complex or specific products – will be described in the upcoming articles.
Do not forget that Code Inspiration team can carry out a desk research for your startup idea. The result will be similar to this article.