As an early startup founder, it’s crucial to be able to interpret as accurately as possible the … [+]
As an early startup founder, it’s crucial to be able to interpret as accurately as possible the real-world viability of your ideas. If you stubbornly hold onto your vision for too long despite being unable to make it work, you risk wasting your time and money on things with no potential. If you quit too early without giving your idea a proper chance, however, you risk quitting too early and missing out on your big breakthrough.
In this article, we’ll attempt to help you avoid both of these pitfalls.
For the sake of this article, let’s assume that:
- You’ve already run a few idea validation experiments.
- You’ve defined your expectations of success.
- The results are in – you have access to data and are ready to analyze it in order to take the next step.
Scenario 1: Bad Results
In this scenario, the results fall far short of your expectations. You may have experienced minimal or no sales, received little engagement on your posts, or potential customers provided convincing explanations for how they currently solve the problem or stated they don’t have the problem at all.
While these results may be disheartening, they provide valuable insights and save you from investing more time and money into an unviable idea. At this point, you have two choices.
The first one is to abandon the idea entirely and find something more productive to invest your energy into.
The second choice is to go back to the drawing board, make significant changes in your value offering, and repeat the validation process.
Scenario 2: Mixed Results
Mixed results are a delicate situation that demands careful analysis. While your outcomes may not have met your expectations entirely, there might still be potential for your idea.
Resist the urge to convince yourself that the results are acceptable simply to give yourself the excuse to move forward Mixed results indicate an invitation for further investigation – they are not a green light for scaling up operations and moving onto the next startup phase.
To interpret mixed results effectively, put all of the data you have to close scrutiny.
For example, you can check the analytics on your landing page and ad campaigns. Analyze the behavior of potential customers who clicked “purchase” but didn’t follow through, as this might indicate pricing issues rather than problems with the overall solution.
Customer interviews and click-through rates of ads can also offer valuable insights. If your ad isn’t generating clicks, but you have a few customers who are happy with what they are getting, then the issue might be in your presentation rather than the solution itself.
Mixed results usually contain conflicting signals. If you interpret these signals correctly, you’ll gain valuable insights into what exactly you need to change in order to achieve more convincing success.
Iterate on your offering based on the feedback gathered and run the validation experiments again. However, be cautious not to spend excessive time iterating on an idea that repeatedly fails to deliver the expected results. If it’s not working after multiple iterations, consider exploring entirely new concepts.
Scenario 3: Good Results
When the results align with or exceed your expectations, congratulations are in order! Your validation experiment has been successful, and your startup idea shows promise.
The easiest way to judge if you’ve truly found product-market fit is to look for the so-called market pull. If you are receiving inbound requests, if your customers are happy and are requesting additional features, and if you are receiving interest from different stakeholders in general, then it’s fairly likely you’ve built something that people need. Combined with the favorable results that you’ve gathered from your validation experiments, this is a good-enough indication to step on the throttle and grow your business.
Celebrate your success, but remain focused on continuously testing and refining your product or service to meet the needs of your target market effectively.
