Have you heard? My new book Continuous Discovery Habits is now available. Get the product trio's guide to a structured and sustainable approach to continuous discovery. This post was written for Startup Edition.
Almost everyone has at one point in their life thought, someone should make a something or another, or why doesn’t this product exist in the world. This is exactly how products are born.
It really is that simple. It always starts with a fleeting thought that blossoms into an idea that through a lot of hard work eventually becomes a product.
But not all ideas should be products. And not all products make good businesses. How do you know which ideas to pursue and which should be left as fun what ifs? Let’s look at a few key questions you can ask.
Are you comparing more than one idea?
A lot of people don’t like to hear this, because if you aren’t well-practiced, generating ideas can be hard. But it’s the truth, so I’m going to say it.
You need to generate more than one idea. As I wrote in Start an Idea Journal, when you generate a lot of ideas, you reduce the chances that you’ll be irrationally tied to your one idea, and you’ll gain the benefit of being able to compare and contrast. If you need hep generating ideas, that post will help. Go read it.
Have you created a business model canvas?
This is single-handedly the best tool I’ve seen for thinking through the different components of a business. If you aren’t familiar with the business model canvas, pick up a copy of Alexander Osterwalder’s Business Model Generation.
It’s a visual tool that helps you think through customer segments, value propositions for each, customer channels (how are you going to reach your customer?) and the resources you’ll need to make it all happen. If you are interested in creating a business and not just building a product for fun, don’t skip this step.
Have you verified the underlying assumptions with real customers?
The canvas is a great way to surface underlying assumptions. Ask yourself, what has to be true for this idea to work? Write down every answer you can think of. Then, as Steve Blank says, get out of the building and talk to some real customers. Do what it takes to make sure those key assumptions are actually true.
What’s your unfair advantage?
What makes you the best person to make this idea a reality? Think long and hard about this question. If the answer is along the lines of: you are really smart, you are a great programmer, you’ll work really hard, keep thinking. There are many really smart, hard working, great programmers out there. If your product is going to be a great business, you need an unfair advantage.
Is this the type of business you want to run for ten years?
It’s really easy to get caught up in the hype of the startup world. Who doesn’t want to be the next Mark Zuckerberg?
But once you’ve identified your best idea, you’ve worked through your business model canvas, and you’ve identified your unfair advantage, ask yourself, is this the type of company I want to run for the next decade?
Yes, I know Instagram sold for a billion dollars in two years. So did YouTube. You aren’t either of those companies. Most companies take a long time to turn into anything interesting. Be careful about what you start, because suddenly that will be your life.
Look at your canvas. Are you excited to serve your customer segments? Are you thrilled about the type of work you will have to do day to day? Can you hardly wait to get started?
Unless you can enthusiastically answer yes to all of these questions, you might want to go back to generating new ideas. I’m not trying to be a debbie-downer. The reality is, you don’t want to start a company that in the long run you won’t have fun running. It’s just not worth it.
The good news is, if you can answer yes to all of those questions, you might just be on to something. If that’s the case, stop reading this blog and get back to work.
What did I miss? Do you have other questions you use to evaluate your ideas? Please share in the comments.
This post was written for Startup Edition.
