Apr 28, 2020
Moe Notes
How to Validate Your Idea
Do people really want it?
It is far too easy to get caught up in the excitement of a new product idea, to invest countless hours and huge amounts of money into developing it, and then to discover that there isn’t an audience out there for it.
To validate your idea, the key is to get people to put money on your concept. That means that they can’t just express an interest, they have to actually spend money or get to the point where they would spend money.
The way that Tim Ferriss (author of the Four Hour Workweek) recommends doing this is by inviting people to buy your product before it is ready and then informing them that you’re waiting for more stock. If enough people get to the point where they would have bought, you know there’s an audience there.
Likewise, you could just take pre-orders for your product — as long as you get your audience to pay for those pre-orders.
A similar method is to sell a beta version or to run a beta test of your service. Running a beta test for a SAS, social network or sharing economy-based business is actually a very good idea because you can test to ensure everything works, you can monitor the load on servers and you can get a good idea of the running costs. This will tell you if the money you make from advertising/fees is more than the money you spend to keep the site alive. In theory, the numbers should hold up as you scale the business further (though of course there may be hiccups along the way).
Kickstarter is another good way to test if people are interested and to completely remove your costs of starting up. If there’s an audience for your product, then they will pay for the initial web design, hosting, and cording, or for the materials and the manufacturing!
