How do you know if you have a good idea for a business?

Think lean, skip the formal business plan and begin by asking yourself these questions...

1. What is the problem I am solving?

Businesses solve problems – the more you know about your problem, the better your solution will be!

2. Who is my target customer?

Be specific. Who are they? Where do they live, what do they do, where do they shop? The more you know about them, the easier it will be to understand their needs and to market to them.

3. What are the assumptions I need to test with my customer to know if my idea is viable?

While your business is in the idea stage, you will be assuming several things that need to be true in order for your business to be successful. These assumptions can help to guide your market research. Talk to as many potential customers as you can (and by customers, we don’t mean friends and family!) and get multiple points of view.

4. Who thinks your idea sucks and why?

Gathering feedback from people who think you can improve is invaluable. This might sound uncomfortable, but identifying potential pitfalls that you haven’t thought of yet is very useful. It can help you figure out how you will address these issues and what your answers will be as you build your business.

5. Who else is solving the same problem as me?

Competitors are not just those that are offering a similar product or service – they are everyone that is trying to solve the same problem as you. Get to know who else is operating in your space!

6. What is my unique value proposition?

Now that you understand your competitors, you need to be able to articulate why a customer should choose you over them. Is your solution quicker, cheaper, better designed or more user-friendly? Tell me: why you?

What is my minimum viable product (MVP)?

Once you’ve validated your idea, you’re ready to build your first version to test. This should be the simplest version of your product or service that you can test in order to get feedback; especially consider how you can test your ideas without using technology.

In conclusion: start small, gather lots of data, and get out and talk to your customers.

Once you’ve got the answers to these questions, we recommend you book a drop-in session with one of our team to talk through your next steps. You could also search for and complete a Lean Canvas template and use this as a working document as you develop your idea further.