Young Entrepreneur Council (YEC) is an invite-only organization comprised of the world’s most promising young entrepreneurs. In partnership with Citi, YEC recently launched BusinessCollective, a free virtual mentorship program that helps millions of entrepreneurs start and grow businesses.
What is one important question I can ask to evaluate whether a startup idea I have is worth pursuing?
1. How Much Time and Financial Investment Will It Take?
How much time and financial investment will it take to get the idea to an MVP (minimum viable product) stage? Generally speaking, I only pursue a concept if it can reach an MVP stage within three weeks of development time. That may seem short, but taking much longer puts you at risk of making too many assumptions. That can result in a product or idea that doesn’t come close to hitting the mark.
2. Will You Be Excited About It in 5 Years?
Without unrelenting passion and deep enthusiasm for the venture, it will fail. It doesn’t matter how solid the idea sounds on paper. Without an emotionally invested leader committed to succeeding at all costs over a lengthy period of time, it will fail. Starting a company becomes your life when you start a new venture — you have to want to live the life the new venture will bring along with it.
3. How Big of a Pain Point is This Problem?
You need to determine how big of a pain point your solution solves. If the pain point isn’t big enough, your customers won’t care enough to pay you for it. If the point paint is huge, your customers will be shoving money down your throat to get their problem fixed. If it’s truly a huge pain, then pursue it.
4. Would You Be OK if It Didn’t Work Out?
Would you be willing to risk the time, money and energy even if the idea didn’t come to fruition? If your answer is yes, then you’ll have enough energy to push through the inevitable hard times, both personal and financial. On top of validating the idea, attaining financing, acquiring customers and delivering the product, you will have to deal with your personal stress and life — so brace yourself.
5. Does Your Product Create a New Habit or Improve an Old One?
It’s no secret that habits are both hard to start and stop. Anytime I hear a startup idea that requires the user creating a new habit, I’m always concerned. On the other hand, any time a new product or service is capitalizing on an existing habit and making it better, I know the adoption phase won’t be an uphill battle.
6. Would You Use It if It Had Terrible UX?
Valuable tools are valuable tools. If you strip away all of the glitz and glamour and it’s still something you would use (not “want to” use), then the idea has potential. Great UXs and positive PR help scale a user base, but it doesn’t define whether a tool is essential or not.
7. What’s Wrong With the Idea?
Even the world’s best ideas have flaws. You just need to identify them and understand how serious they are. Have an unbiased person play devil’s advocate and poke holes in your idea. Once you uncover potential problems, determine whether you can prevent or overcome them by patching the idea or finding a suitable workaround.
8. Is It a Product or Only a Feature?
It’s hard to build a sustainable business around a feature. People buy solutions to their problems, defined as benefits and packaged as a well-rounded product offering. They don’t use single features for very long. Why? Because the startup that offers a better product will soon include your break-through feature. Double check that you’re building a product, not just a nice-to-have feature.
9. How Much of the Market Can You Capture?
You first need to understand the overall market size. Next, decide what you think you can realistically do to capture that market. Most people are confident they can capture at least 10 percent, but in reality they only get about one percent. Ten percent is a lot more than it looks like on paper.