New Business ideas require Proof of Concept. This means being very clear about what business problem or problems your concept solves, and proving that out with some research and testing.
So, you’re bored out of your brain working for some moron of a boss and you’re thinking if only you had your own business, life would be so much better!
Okay, maybe your boss isn’t a moron, you’re just plain sick and tired of working bloody hard for someone else and lining their pockets. Fair enough. You’ve got an itch (and it’s not from dry skin!).
Before you jump off a stable income platform, here are some truths about business ideas that you should consider.
You’re itching to have your own business and you’ve been thinking about your idea for quite a while. You think it’s sound, but you haven’t put it to any sort of a test……yet!
This is where Proof of Concept plays such a vital part in the early stages of fleshing out your business idea.
In your mind, as far as you can tell, it’s a damn good idea, and you’ve been telling yourself that people will just love it. Maybe you’ve also been quietly asking yourself how you go about launching your business idea.
Having a good idea is great. Your big question is more about knowing that the problem you want to solve for people is a problem that exists. This comment is not as silly as it might sound.
You wouldn’t be the first budding Entrepreneur who just started by building products, or services, without knowing if the problem you solve is something people want or need.
There are more than a few stories of Entrepreneurs who, after launching their product/service found it was to a non-existent problem. So, they started business life waiting for the sweet sounds of the cash register ringing.
Disappointment doesn’t come close to expressing how they felt at the deafening sounds of silence from the Cash Register.
The Cash Register isn’t ringing, instead, all they can hear are crickets chirping.
Turning your idea into a testable, provable premise will help you to understand and validate the problem well before you go wasting time and money building a solution to a problem that does not exist.
In her blog, Deborah Sweeney has created a post which confirms a number of the points I have made here. https://www.deluxe.com/sbrc/starting-a-business/5-steps-to-a-proof-of-concept-for-your-business-idea
Here’s another approach to consider taking on board……..
Proof of Concept – Fall in Love with the Problem, not with the Solution!
As I’ve said a little earlier, many an Entrepreneur has focused on the solution rather than the problem. As soon as they have the first nugget of a business idea, they start building it. Failure to develop your Proof Of Concept can send you an a wild goose-chase.
In their mind’s eye, they’re already imagining their future lives as wealthy business owners, sipping champagne and cruising on their private yacht.
Every problem has a solution, but not every solution solves a problem.
Solutions are replaceable, but the problem stays the same. Focusing on the problem you want to solve will keep you from getting blinded by your enthusiasm for a single solution.
The following steps will help you to not only develop your premise or proposition, they also help you to know where to start looking for your potential customers. Then and only then, can you start to validate your Proof of Concept for your business idea
Step #1 – Develop Your Premise to prove out your Business Idea
This is a statement, the validity of which needs to be proven under certain conditions.
From this point, we will refer to the single term of PREMISE, to cover off on Proposition or Hypothesis.
To help you form your premise, shape your Business idea into an attractive customer value proposition. How do you do that?
Divide your origination process (your bright idea) into four small parts. This will give you a lot more detailed information about the purpose and the goal of each stage. Here are the four parts:-
A – Who is your customer?
The creation of your premise begins by describing your target audience. Who are they? What are their issues? Where do they go when they need information? Building a clear picture of your Avatar starts to make your ideal come alive. You need to develop these critical components in some detail.
This description becomes your Avatar. Your Avatar becomes a significant piece in the jigsaw puzzle of knowing your customers. Realizing that your customers are a group of people with a common pain or need.
Picture the people you think have the problem you want to solve. Break your target customers down as precisely and as focused as you possibly can. Find a stock image that represents the type of person your are describing. Now you’re breathing life into your Proof of Concept.
Knowing your customers really well. will help you to get a clear picture of what really matters to them.
B – What is their problem or need?
After targeting your audience, the first part of your core premise is the so-called customer problem. Their Pains and Frustrations.
Don’t approach this too academically – the goal is to prove that the problem or need you assume is there, actually exists or it doesn’t.
What is the specific problem this customer group has? Describe it from their point of view. How are customers trying to solve the problem today?
C – How will you go about fixing this?
Once you’ve confirmed the existence of the problem you want to solve, it’s time to ascertain your value proposition or problem-solution (premise) hypothesis.
How do you solve the problem, and what is the core benefit for your customer?
Remember that you have to validate the customers problem hypothesis first!
If there is no problem to your solution, there is no need to take further steps.
D – How feasible is it?
If your business idea is feasible or not depends on more factors than just the solution-problem fit.
It’s also important to consider your business model from the beginning.
solving the need that people want to get in shape by offering home gym
equipment for $1 would create some awareness, but practically speaking you
should query this idea.
Step #2 – Proof of Concept – Choose a Testing Method for Your Business Idea
There are several ways to get your premise in front of your audience.
Depending on your experience and business or social networks, you can choose which one of those makes the most sense for you to start with. It’s recommended to start with face to face conversations.
There’s nothing better than face to face conversations. They are direct and they are real. These conversations give you a much better understanding of your first lot of feedback, along with might appeal when you start building and using landing pages.
The most important step is to offer your audience the solution they expected.
Build a Minimum Viable Product (MVP) without getting too complex. Now your Proof of Concept for your Business idea is really starting to gain some shape.
Step #3 – Proof of Concept – Set a Goal to Validate Your Business Idea
Find a simple and easy way to deliver your service to your customers. The goal is to find out how good your solution is. Are they happy with it? Would they use it again or even refer friends to it? Get as much insight as possible.
Before you can start testing your premise, you have to set goals on whether your idea succeeded or not.
Keep it simple – should be your guideline here.
Let’s say you created a list of ten people; at least seven of them should prove your premise to be right. Once you have validated the premise with a small group of potential customers, you can scale up the experiments to test it with a broader audience. This is where the fun begins.
If you’ve completed the set-up, you are ready to run the test. Don’t forget that every element of your premise has to have the potential of failing.
Step #4 – Proof of Concept – Run the Test & Analyse the Results
Every element of your Business idea needs to be validated.
After you have collected data from potential customers, it’s time to decide if you’ve reached your goals and if your assumptions were right. More often than not, your first idea on how to solve the problem is not correct.
For the moment your business idea is missing proof of concept.
Don’t let it get you down, though; after all, it took Thomas Edison hundreds of attempts before he invented the light bulb, and that turned out OK for everyone in the end.
Pivoting your idea is a common element on your way to finding market fit.
Get back to your interviewees, start asking more questions in detail, and try to figure out how to adapt the feedback to your idea.
If your idea got taken apart and you don’t see how to fix it – keep on going! The next big opportunity will come!
Starting your business by testing your idea first will not only show how valid it is. You’ll also get a solid ground for your further decisions:
You now know your customers and what they really want. You are on a good path to creating a product or service that people will love!
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John is passionate about business and specializes in helping established businesses to reset their business for performance, with less reliance and demand on the owner to be there all day, every day, without so much as a break
Everything John does to help a business to reset, has a framework behind it that optimizes that opportunity. Frameworks help bring about clarity and focus.
John is also the founder of the ‘No BS Business Zone’ where Entrepreneurs have an opportunity to step up and get serious about improving their business results and bringing about real change.