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How To Validate Your Business Idea

Everyone has business ideas - but the bigger questions are:

  • Do people actually want this?
  • Will people pay money for this?
  • How much will they pay?
  • Can this be profitable?

Here are 8 ways you can validate a product idea - which, if taking the right steps, can save you months, if not years of time working on the wrong idea.

Related: Designing and Prototyping A Product

#1: See if people are searching Google for your product

One of the best ways to validate a product is to make sure that people are actually searching for it. If they're not searching for it - it might be a sign that nobody needs it.

Luckily, there are hundreds of tools you can use to see if your product idea is being searched for.

The first one is simply by going to Google and to start typing and see if your targeted keyword is in the autocomplete search results:

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Another great tool is Google Keyword Planner.

For a real world example, Jack Bramhall had an idea for a coffee product, and used Google to find hundreds of other people that were looking for the product:

Quite simply the original idea came from asking the question “Why can’t I get hot chocolate for my Nespresso machine?”, combined with “Surely I can get cheaper Nespresso pods?”.

Using Google’s own tools such as the keyword planner and trends, we were able to quickly identify that there were thousands of people asking the same question that I was - but nobody providing the product! The Nespresso and coffee pod market was also quite clearly growing exponentially across the whole of Europe.

To be clear, there were other companies making “compatible” pods for these machines, but coffee only and from my own research there were a lot of issues with compatibility and quality.

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Jack Bramhall, on starting Mugpods ($21,000 revenue/mo) full story

Using search tools, you can actually see the number of times your keywords are being searched, which can help you determine the volume.

If it's only being searched 10 times per month, you'll want to determine if that's enough demand for your business.

For example, Kyle Bergman found that up to 1,000 people were searching for a product idea that didn't even exist yet:

Once I realized other people might want sweatpant overalls too, I used Google's keyword search planner to see roughly how many people were looking for this term online. In the month of March 2017, this tool showed that between 100-1,000 people were also looking for sweatpant overalls.

sweatpants-overalls-how-i-turned-a-silly-idea-into-a-viral-brand Keyword search results in March 2017

A part of me was shocked, but after I thought about it...it made sense - probably a little awareness created from the BuzzFeed article, but more importantly, people just like me were looking for an awesome, comfy combo.

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Kyle Bergman, on starting The Great Fantastic ($17,000 revenue/mo) full story

#2 Build your Email List

A crucial step in validating your business idea is to build a list of email subscribers - you don't need a list of a thousand subscribers to start, just enough to determine who your audience is & if there is a need for your product.

A great way to start is by building a simple landing page on your website that describes your product & what you are planning on building. From there, you have something that captures the customer name and email address.

Bonus: Offer something free to your customer so they are incentivized to provide you their information, and may even convert into a real-life customer.

For example, Samer Awada, Founder of OneSEO drove traffic to a landing page and offered a FREE guide in PDF form in exchange for their customer's email address.

We expected our first order to come in at least 6 months down the line after our first launch. However, in the first month, the business generated a little over $1,000 from a 500 person pre-launch email list we had built two months prior with the use of facebook & a landing page.

Fast forward one year later and with just a little bit of marketing, the company generated a little over $50,000 with an average MRR now of $15,000.

quitting-my-full-time-agency-job-to-build-my-own-software-product April 1, 2018 - May 31 2019.

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Samer Awada, on starting OneSEO ($15,000 revenue/mo) full story

By using a "free guide" as an upsell, you can then let these prospects know about your business (or your business idea).

Samer shows his email sequence and marketing copy for prospects that give their email address on his landing page:

We have 2 main email marketing sequences set up.

The first email sequence handles all new leads that come in from our main Facebook Ad, and the second one takes care of users that take the second step and create a free account with us.

Here is the first email users receive once they opt-in to receive the PDF guide.

quitting-my-full-time-agency-job-to-build-my-own-software-product

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Samer Awada, on starting OneSEO ($15,000 revenue/mo) full story

#3 Create Facebook Ads for your product

Facebook Ads are a great and inexpensive way to drive targeted customers to your website & product.

Even if the product is not quite ready, but you're looking for targeted and unsolicited "feedback", this can be a go-to method for validating your idea.

At this stage, the goal for your Facebook ads is not necessarily to convert leads (although that may happen organically), but it's to determine different audiences that may or may not be interested in your idea and to observe the types of engagement you're getting.

A few quick & easy tips:

  • The Ad can be as simple as a small promotion/incentive of the product or a short video of the product.
  • Engaged users will watch the video (even if it's just for 5-10 seconds) or click around on the Ad.
  • Make sure you have a Facebook Page or Landing Page that users can click to learn more about the product. We talked about this in #2, but this is highly crucial so you can collect customer data and observe analytics (ie. number of clicks, where people are clicking, time spent on your page etc).

For example, before Gary Fox launched his bootstrapped Airbnb Management company, he needed to understand the pain points of hosts and see if there was actually a demand for this management service.

How did he do this? Simple: He created a basic SurveyMonkey and used targeted Facebook ads to promote it to his target audience: people in Dublin that were already Airbnb hosts.

Here is exactly what that ad looked like:

how-i-bootstrapped-an-airbnb-management-service-to-35k-month My original Facebook ad to validate the idea

Two weeks later, I had 30 responses and enough demand to convince me to kick off the task of creating the business.

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Gary Fox, on starting Host Butlers ($35,000 revenue/mo) full story

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Some founders are very experimental with Facebook ads.

For example, Dylan Jacob (founder of BruMate) walks us through his experience with testing Facebook Ads prior to launching his product:

For the Winesulator, I ran targeted Facebook ads for pre-orders / email capture to our target audience starting in August of 2016 and had really good feedback on the idea so I just ran with it. The cost to mold/manufacture the Winesulator was about half of what the Hopsulator was going to cost so I considered it low risk and decided to pull the trigger on molding without actually releasing any prototypes. I relied on photoshopped imagery to gather sales leads while it was being produced and by the time the inventory arrived in November had a list of around 7000 people to launch to.

In the beginning, this is how we built our initial traction: -I spent $20-30/day on different audiences using the same images/copy and narrow that list down based on performance. -Once I found a few audiences that worked I would run ads directing people to our landing page to sign-up and be notified when our product launched (for me, this was the day after Black Friday). -Ended up doing $250,000 in sales from November 24th-December 14th 2016.

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Dylan Jacob, on starting BrüMate ($1,100,000 revenue/mo) full story

#4 Talk to Potential Customers

Another common method of validation is simply talking to people.

Reaching out to potential customers to ensure your product is going to solve their specific needs may be one of the most critical parts of validating your business idea.

As simple as it may sound, you just need to reach out to your target customer and ask them if your product idea addresses a specific pain-point for them, and if they would pay for it.

For example, Kyle Racki, Founder of Proposify ($570K/month) shows us just how important this is:

Our process was to try and build something users wanted.

You begin a business by focusing on an area of pain in a market, and then talking to potential customers in that market. Once you validate your idea, build a rough, ugly version by any means possible. Then launch it as soon as possible.

After that, iterate as quickly as possible, and sell the shit out of what you’re building. That really is the only way to make it work. Revenue solves almost everything. If you have revenue you’re not at any investor’s mercy.

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Kyle Racki, on starting Proposify ($570,000 revenue/mo) full story

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Talking to customers is not as complicated as it sounds. There are a variety of ways you can get feedback on your product idea.

For example - Matthew Rideout, Founder of Strict Chef bought strangers coffee at Starbucks in exchange for 20 minutes of their time to discuss his app:

You’d be amazed at how readily strangers will meet you at Starbucks and spend 20 minutes discussing your app concept, for the price of a coffee. Keep doing this until your prospects are begging for your prototype to be real, until they are saying “wow, when can I get this!?”

Get as much of your app prototype validated and ready before writing a single line of code. There are so many great tools available today that allow one to build high-fidelity prototypes. One can rapidly iterate their app concept by demoing these prototypes on-device with prospective customers very affordably.

Keeping your idea a secret is not going to get you anywhere. You’ll end up building something no one needs. Customer interviews and market research are the most critical part of app development.

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Matthew Rideout, on starting Strict Chef full story

Essentially, the foundation of what you build should be a direct result of customer feedback (the bad and the good).

Take any opportunity you can to hear from customers and continue to learn what it is that they value most.

#5 Build a Landing Page

We briefly talked about the importance of a landing page in #2 and #3 as compiling an email list, creating Facebook ads and building a landing page all compliment each other.

Let's dive a little bit deeper into what it takes to build a landing page and go through the steps to building this out prior to launching your product, and learn through some examples.

Cody Candee (founder of Bounce) walks us through the quick and easy steps they took to build a landing page and validate the product before going all-in:

Aleks and I were brainstorming new business ideas when I mentioned the idea of “an Uber for your things.”

  • We decided to put up a landing page for bag storage and delivery in New York City
  • In three hours, we used a basic landing page builder, plugged in Adwords and had our first customer request a "Bounce" 5 minutes later.
  • We hopped on Citi bikes to fulfill our first orders, and from then on customers kept coming

We saw that there was enough demand with just a web app and continued supporting this and growing users while we started laying the groundwork for our mobile app.

People found us through online search, Adwords that were profitable, and word of mouth.

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Cody Candee, on starting Bounce ($15,000 revenue/mo) full story

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You don't have to be an expert at code to create a landing page.

There are various different platforms that are more "plug and play" and allow you to easily create a template. A few easy ones to get started would be:

Once you have created your landing page, a creative way to see if customers are actually interested in buying your product is to actually create a "BUY NOW" button.

For Example, this is how Mike Lecky (founder of Vagabond Heart) tested out his product:

Once you have your idea for a product (or service) come up with a Minimum Viable Product and test interest on that. For me, I was able to produce a small number of my actual product, which meant if the product had been a total failure I would have only been out about $1000 in unsold product.

If you can’t do that you can create a website for your product with a BUY NOW button that goes to an error page or a “sold out” notification, and you can judge the interest by seeing how many people clicked to buy.

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Mike Lecky, on starting Vagabond Heart ($5,000 revenue/mo) full story

#6 Get Feedback from a Targeted Niche

We talked about how talking to your customers and strangers is important, but we can take that further.

There are other ways to get feedback from a targeted niche that can really help build your confidence & validate your product.

Some examples:

  • Facebook groups
  • Subreddits
  • Niche forums
  • Twitter communities
  • Meetups
  • Product Hunt

A great example of this was when Diego Rios, Founder of Markeko, posted his idea in a digital marketing facebook group and ultimately got kicked out.

Check out the story below to see how this single post validated his business idea:

“You’ve been kicked out of the group!”

I was surprised… but also it was the time I knew I had to do something about it!

Facebook announced that they were launching their Facebook Blueprint Certifications for the public back in 2017. I thought it was a good idea to get certified as I was working in the digital marketing space but couldn’t really find content or helpful guides.

There was really no big plan or idea when I first started Markeko. I stumbled upon a problem when I first took the exam and realized more and more people were going through the same.

It really started with a comment on a digital marketing Facebook group.

I was a member of the Digital Marketer group and wrote a post as I had just passed the first Blueprint Exam. I got really good feedback and a lot of comments from others who were looking into taking the Facebook Blueprint Certification Exams.

how-i-started-a-4k-month-blog-that-helps-people-get-facebook-blueprint-certifications

I ultimately got kicked out of the group as the free study guide had links to the website I had just built; however, it was a great way to validate my product and idea without spending money on it!

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Diego Rios, on starting Markeko ($4,000 revenue/mo) full story

#7 Build a Prototype for your product

If you're hoping to decrease any sort of risk that comes with launching and mass-producing a product, designing a prototype can be a great way to de-risk that situation.

The point of a prototype is that it doesn't have to be perfect.

In the beginning stages, it doesn't matter how rough V1 of your prototype is, it's more important to just get started and you can always refine from there based on feedback from your network and most importantly your customers.

You'll love Emma Lovell's story of designing her initial prototype for her business, CoziGo:

The initial prototype of CoziGo would make you laugh.

I asked my hubby to make a box the size of an average airline bassinet. Then I went to a hardware store… the prototype was made up of plumbers tubing, black fabric, and double sided sticky tape as I can’t sew to save myself.

It was the ugliest thing ever, but it gave me something to photograph so I could start liaising with potential manufacturers. The first manufactured prototype was 80% there the first time…. It took a further 18 months to nail the other 20%!

So I finally get a prototype I'm happy with, only to find out that 80% of them were completely unfit for sale. Eighty percent of the units were twisted and the incorrect shape and the quality of workmanship was nowhere near that of the samples that had been previously made for me. The factory refused to take them back and said it was our problem! That cost my business $25,000 and the most heartbreaking thing was having to pay $1000 to have them taken away to be shredded and put into the landfill!

Once I stopped crying over that, I set about finding an alternative manufacturer and started the whole process again. I made the unusual decision to stay with the same agent - I felt like his experience should have protected me from these issues, but he took responsibility and agreed to forgo commissions on a number of future orders so we could move forward.

Moving forward, it was somewhat easier as we had a prototype that we were happy with and simply needed to find a factory that was confident they could make them. New molds had to be paid for, but I knew the right questions to ask this time around and we kept moving forward.

article

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Emma Lovell, on starting Fly Babee ($26,000 revenue/mo) full story

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Prototyping gives you the opportunity to promote your product to the world, ask for opinions and refine the product based on those opinions.

You may feel overwhelmed and like you don't have the resources or upfront investment to create the perfect product or the perfect design.

One great resource to use is Upwork. You can have businesses and independent professionals help design something for you at a minimal cost.

For example, Andy Jefferies makes $5M/Year selling beach towels and shows us what it looked like to design his product:

We made a prototype design (which was less fancy-looking than it sounds, made from a pulled down curtain) and ordered samples from various factories and manufacturers from China.

how-two-founders-started-a-5m-year-business-selling-beach-towels

It sounds weird, but I carried around those sample towels everywhere I went to make sure they worked in all situations. I showed the product to friends and colleagues asking for their opinion and once Ben & I were satisfied, we uploaded the towel on Amazon. We sold 100 on the first day but I’m pretty sure most of those sales were my mom.

We didn’t have any experience with any of this stuff - design, manufacturing, accounting...

The process was very much randomly pulled together. We had our designs made abroad through a company called UpWork, a freelancing tool where businesses and independent professionals connect and collaborate remotely. Then it was a lot of going back and forth sending feedback on the samples we received. It wasn’t a slick process at all since we honestly didn’t have any experience so it was very much trial and error before getting a product Ben and I agreed was right.

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Andy Jefferies, on starting Dock and Bay ($450,000 revenue/mo) full story

#8 Launch a Crowdfunding Campagin

If you're looking for some exposure & additional funding, crowdfunding can be a great way to help you scale your business.

Kickstarter is a great resource to share your story, secure funds and collect feedback about your product. It can also really help with funneling organic inbound leads once your product comes to life.

For example, Travis Peterson, founder of Joker Greeting created a successful Kickstarter campaign and raised $92,073 in 30 days with no marketing:

We launched on Kickstarter - we didn’t have a brand, website or anything.

We hit our $7,500 goal in 3-4 days after being picked up on CNET, and ABC News. Later it was BuzzFeed and Gizmodo and more. This was when I learned what “going viral” truly meant and how making a great product can matter so much more than making a just a good product. joker-greeting-main

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Travis Peterson, on starting Joker Greeting ($50,000 revenue/mo) full story

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We also have some really cool insight from One Of The Most Successful Kickstarter Campains in History, Scribt.

The Scribt team wanted to really understand their market, and felt the best way to do that would be through a crowdfunding campaign.

In the first 60 minutes, the campaign raised $50,000 USD, in 24hrs - $180,000 USD.

In the end of our Kickstarter campaign the sum total raised was exceeding USD 1.6 million, ranking Scribit’s campaign among Kickstarter’s 150 most successful campaigns ever. Upon finalizing it, we saw Indiegogo with their inDemand platform as a natural continuation to popularizing Scribit and cultivating a community of very involved backers. To whom we have a very deep sentiment, they are our Achilles heel so to say, the backbone of Scribit, the engine of the whole process with their support and even criticism.

Within spring 2019 we are to deliver the pilot Scribit batch to our backers. Largely based on our Kickstarter’s campaign we have observed that 30% of the current traffic comes from existing partners, 30% was boosted from PR campaigns (interestingly enough, most of the media exposure we get, we do not pay for but was initiated by the media partners), and 30% was built by FB agency partners. We have also moved to e-commerce, with Scribit being available for pre-orders solely on our website. Currently, our main occupation in terms of e-commerce is to generate traffic to scribit.design.

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Scribit, on starting Scribit ($2,300,000 raised) full story

Conclusion

There you have it - 8 ways (and many examples) of how founders validated their ideas before going to market.

Are you in the process of validating or looking to get started, or have any questions? Join our community!

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Pat Walls,   Founder of Starter Story

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