As humans, we tend to keep thinking of new ideas. The most important question is what problem are we solving?
There is no point investing your blood, sweat, tear and a whole lot of resources behind an idea which does not solve a problem.
Step 1 — Know the problem
You want to be able to clearly articulate the problem you and others are facing. Don’t think about what you have to offer, just focus on the problem instead.
You should be able to explain others this problem in a powerful one to two lines. A few examples:
It’s impossible to sell excess perishable food at the end of the business day or;
It’s too hard for an idea stage startup to get referral leads
It’s too hard to learn marketing for non-marketers
You get the idea — keep it basic and refine the problem until you can articulate it with one sentence.
Step 2 — Know the size of your problem. Is it one of the top 3 problems?
There are problems everywhere but not every problem is worth a billion dollars. Some problems are so small that they are not worth the resource allocation. I don’t know how to change the bed sheets. Is that problem big enough? No. I can YouTube it if I wanted.
You want to find a problem which is one of the top 3 concerns for your potential buyers.
Let’s say your potential ideal buyer profile is the sales manager of a SME. Their top 5 priority wise problems might be like:
Increase the ROI on marketing spend (hire a head of marketing)
Generate more sales
Outsource HR, payroll and benefits
Increase product selection
Get better at social media and invest in Facebook ads
If you’re planning to launch a social media service company, you can see that’s NOT a tier 1 (top 3) problem for the typical sales manager of a small business — it’s #5 on their list.
They will be looking at solving their first 3 problems first before allocating resources to problems 4 and 5. This means that they won’t have time or resources for you or your product even if you built a really great product/service.
This is where you need to be practical as a startup founder/aspirer. We hear so many people say, “But my idea is so good, it’s impossible for it to fail.” Or “It’s such a great looking product, people will love it once they use it.”
So how do you validate that your problem is a top 3 problems? You need to start by picturing your ideal customer sets.
Never, ever build a startup that solves a “nice-to-have-fixed” problem. Most times it will be a case that people would love to use what you have to offer but would not like to pay anything extra for it.
Step 3 — Know your potential customers
Not every product is as universal as Facebook. And that’s okay. You do need to know who your first customers maybe. These are the people are really facing the problem you just mentioned previously. For example, you are building a tool for lead sharing. Some of your first customers could be mortgage brokers or financial planners. They are always looking for quality leads and they are quite happy to pay a premium price for their leads.
Knowing who your ideal customers are is important. Going into business without knowing who needs your products is as good as gambling money on number 17 at the American Roulette.
You need to know who is facing the problem you are solving, and these are some of the things you want to know about your idea customer: