Why Your Idea Should Go Through Concept Validation
The first step to starting any business is finding a problem worth pursuing. Sounds easy, right? Well… it isn’t necessarily that simple.
The trick with finding a good problem is making sure that others experience this same problem and would pay to have it solved. Once you have identified the problem and tested your solution in the market, yielding a positive result, you can start to build a business.
This process explained above is called concept validation and we believe it to be a crucial first step in any business development journey. When done properly, concept validation will save you a lot of time and money and will determine what goes into the design and development of your solution.
What is Concept Validation?
Concept Validation is an iterative process of de-risking your idea as it moves forward with the end goal of reaching a feasible solution.
You can expect to deep dive into the following areas:
- Problem exploration
- Identifying a value proposition
- Working to understand potential business models for your idea
- Establishing KPIs
- Identifying key assumptions and unknown factors regarding your idea
- Testing your concept through setting hypotheses and experimentation
Why should your concept be validated?
1. It reduces risk
While your product is still only an idea, it remains a set of assumptions that should be tested and supported through market research and deep experimentation. No need to spend a lot of time, effort, and money on an idea that will never become a lucrative business.
So, how do you ensure that you’re not wasting your time on an idea that’s doomed to fail…? You speak to users as quickly as possible.
We do this for all stages of the concept; problem statement, value proposition, and business model. If we build up a body of evidence supporting your hypotheses, there is now more reason to spend more time and effort in leaning into whatever path you’re on.
It is important to note that concept validation is a continuous process that will not end when you decide to build. Building a product, whether a duct tape solution or ground-up development, is only necessary when all other experiments are no longer powerful enough to disprove your hypothesis.
Building is merely the next step in validating one’s concept, it’s just that now you’re validating a product (which is in essence = concept + a whole lot more [distribution, user experience, scalability, etc.]). After your product has been developed you should continue to test your product in the market, inching ever closer to product-market fit.
2. It produces data that will inform (and convince) multiple stakeholders
Firstly, the concept validation process will provide the data to help you make an informed decision in moving forwards. Too often entrepreneurs rely on their assumptions beyond what is reasonable - your product should be user-led at every stage. A great resource in this regard is Eric Ries’ The Lean Startup.
Furthermore, by clarifying what your business model might look like, and the potential market it operates in, you will be able to gain an understanding of what the value of your business might be if you were to execute on it. This is incredibly important, not just for looking for funding, but for yourself too. If your business model isn’t lucrative enough, it might not be worth building.
If you were to go through the concept validation phase successfully, you will be able to show relevant stakeholders a distilled problem statement, a value proposition, a business model and the directions to what is needed to build the solution. All of which will be backed by the market data collected during validation. This will make your venture more attractive to possible co-founders or employees and ultimately increase your chances of getting investment.
3. Speeds up delivery of your product
Have you ever heard the saying: “Measure twice, cut once”? That concept is applicable here.
The process of developing a product from the ground up, is a long one. It takes time to develop a product that is good enough to take to market, and then even more time to test that product and implement changes.
By testing your concept first, you can initially forgo the time required for a recursive development process, and likely save yourself time and money by not developing something based on untested assumptions.
When the time eventually comes to build, you will have compiled a lot of data from speaking to users, which will empower you to make an informed decision regarding which features to prioritize for the MVP build, based on what will drive the most value for your users.
4. Minimize the costs
Concept validation minimizes costs in multiple ways, many of which we touched on in previous sections of this post. In summary:
The process will prevent you from investing in an invalid concept, and it will provide you with useful data. This data will inform you on what aspects of your product to prioritize and which features to cut, decreasing time and development costs.
Concept validation cannot guarantee that your concept will be a success but it can give you a good idea if it will be a profitable solution.
At Specno we want to see our clients succeed and aim to equip them with the resources they need to do so. We therefore strongly suggest taking the time to go through the concept validation process, as it holds valuable benefits for founders wanting to build out an idea.
If you would be interested in going through the concept validation phase with us, contact us to discuss your options.