If you’re going to get something wrong, it’s better to find out fast.
With market validation built into your product roadmap, you can find out where you’re wrong faster.
And you will get plenty wrong. In three years, if you’re still around, your startup may look completely different from what you imagined.
This post is the last of our three-part series demystifying startup failure. We talked first about the concept of speed in building your team. Then we dug into how focus can help you move faster. Today we’re going to look at the fundamental role market validation plays in speed.
Market validation is more important than anything else
Market validation is more important than any other factor when you’re building a new product. It’s how you learn what people need, what they’ll pay for, and what they’ll continue to use -- so you know what to create.
Because, frankly, what’s the point of creating something without confirming that people will buy it?
What is market validation?
When people say market validation, they’re usually talking about interviewing potential users, but startups can also use different channels to supplement that data. Some ways to get feedback from your market might include:
- Landing page signups
- Pitching resellers
- Testing changes with your users
Market validation lets you maximize speed of learning at your startup through feedback from the market.
How market validation helps you fail faster
The number one reason startups fail is that there’s no market need for the solution they built. Shocking, right?
The last thing you want to do is pour everything into developing a new software product and then realize no one really cares about solving the problem enough to pay for it!
Market validation must happen quickly, before committing to a roadmap. In the beginning, you will want to confirm some basics before you design a prototype or write a line of code. Ideally it will continue to inform your product roadmap as you continue.
What things can you validate?
When you start out, you make assumptions. Without real data, you’re just guessing. Some of the fundamental things you want to know are:
- There really is a problem
- How many other people think it’s a problem?
- How important is it to solve the problem?
- Who the problem impacts the most
- Is your target market really who you think it is?
- Who is willing to pay for a solution?
- Who else might be involved in the purchase?
- How can you reach them?
- How to solve the problem
- Will people actually use what you’re building?
- How can you make it easy to adopt?
- How to charge for your solution
- How much are people willing to pay?
- How does it make sense to pay? (E.g., subscription or one-time purchase, usage tiers or flat rate, etc.)
Looking at this list, it’s easy to see why market validation is important if you want your startup to succeed. Yet these fundamental questions often go unanswered with more than a hunch.
In our Power Checklist, we outline several market validation steps you should complete before and while building your product.
Market validation to determine focus
When we say ‘fail fast’, we mean to find out the things that don’t work so you can pivot away from them quickly.
We recommend you compile all the fundamentals into a lean canvas for your startup. (We introduce the lean canvas tool in our scoping workshops.) You will then have in front of you the major assumptions you need to validate. As you confirm them, you can adjust your strategy quickly.
By shifting your focus quickly, you can keep your team agile. You can conserve cash. And you can reach that sweet spot of product/market fit much sooner.
Well, that’s it folks. This concludes our series on speed and how we leverage it in our methodology. If you’re just jumping in now, here’s the link to the first post: What all successful startups get right: speed.
Talk to us about how we can help you build speed into your new product development process. We’d love to hear what you’ve got going on!