Launching a startup is fun.
You have an idea.
You think about the website.
You think about the logo.
You think about the product.
You think about how you’re going to acquire customers.
Sometimes, you get so caught up in the moment that you forget to ask one simple question.
Who wants what I’m building?
That’s one of the biggest mistakes that people make when launching a business.
They spend money to build something that they don’t know if there’s any demand for it.
This doesn’t just apply to big startups.
It also applies to Shopify stores.
It also applies to mobile apps.
It also applies to online services.
It also even applies to advertising.
The silver lining here is that you don’t even need a lot of money to start validating startup ideas.
A Good Idea Isn’t Necessarily a Good Business
Let’s say you had an idea for an app that helped people find car detailing services in their area.
You think it’s a good idea.
Your friends say they’d use it.
You hire a developer.
You build the app.
You spend a few grand in the process.
Here’s the thing.
Do people even have trouble finding car detailing services?
Would they even download an app for this?
Would they pay extra to be convenient?
What are they using now?
All of these things are more important than how pretty your app is.
That’s why startup idea validation should be the first thing you think about when you have a startup idea.
You don’t need to know if your startup idea is good.
You just need to know what assumptions could potentially break your business.
Customer First, Then Product
When validating startup ideas, the first three things you should ask yourself are:
- Who exactly does this product need?
- What problem are they facing?
- Why would they choose this over what they’re currently using?
Specificity is important.
“Everyone who owns a car” is not a specific target audience.
“People who live in apartments and don’t have the time to go to a car wash” is.
When you know who you’re building your product for, it becomes a lot easier to know what you should validate.
This strategy applies to any type of business idea.
Whether you’re building a SaaS product.
Whether you’re building a dropshipping store.
Whether you’re building a mobile app.
Whether you’re even building a local service.
AI Is Changing the Way People Brainstorm Business Ideas
One thing that has changed is that people are now using AI to brainstorm business ideas.
Asking ChatGPT for competing products.
Asking ChatGPT for reasons someone might not like your idea.
Asking ChatGPT for questions to ask customers.
There are also AI startup idea validation tools where entrepreneurs can more thoroughly dive into potential customer reactions to their startup ideas.
For example, SellTo.us is a platform where entrepreneurs can test startup ideas, products, apps, services, and even advertising ideas with AI simulated audiences.
Entrepreneurs describe their startup idea and get simulated feedback on potential customer interest, reasons someone might not like their idea, and questions on how their idea could be improved.
There’s also a free test you can do with 100 AI simulated customers.
The one caveat with AI feedback and AI simulated customer feedback is that…
AI simulated customers are not real customers.
They can’t be used to prove someone will buy your product.
They can’t be used to predict sales.
That being said, it can be nice to use AI feedback to help you determine what questions you should ask before you spend money.
For example, maybe your price point is too high.
For example, maybe your target audience is too broad.
For example, maybe your product description isn’t compelling.
All of this matters.
The Difference Between AI Feedback and Real Demand
While AI focus groups and simulated customer feedback can be helpful for brainstorming, it’s still not a replacement for real market research.
Real validation requires real customers.
Here are a few simple ways that you can validate a business idea:
Do customer interviews. Find people who currently struggle with the problem you’re trying to solve and ask them how they currently deal with it.
Build a landing page. Describe your product and see if people are interested enough to join a waitlist.
A / B test headlines or offers. Have two different headlines or offers and track what happens.
Run a small ad campaign. If you have the budget, run an ad targeting the right audience and see if people click and take meaningful action.
Ask for a real commitment. Get a preorder. Get a paid pilot. Have a serious sales conversation.
All of these are valid ways that you can validate an idea.
The difference is that you don’t need to do all of these things at once.
Start small with your first test.
Don’t spend 5,000 to validate something you could have validated with a few customer interviews or a test.
Don’t spend weeks perfecting your product only to find out that people don’t understand why they need it.
How Much Money Should You Spend Validating an Idea?
There’s no magic number.
If you’re building a simple online service, customer interviews and a landing page may be all you need.
If you’re making a physical product that needs to be manufactured, you may need to do more than that before you buy inventory.
The takeaway here is to start small with your first test.
Don’t spend 5,000 to validate something you could have validated with a few customer interviews or a test.
Don’t spend weeks perfecting your product only to find out that people don’t understand why they need it.
How to Validate a Product Before Running Ads (If You’re Dropshipping)
All of this applies to e-commerce as well.
Let’s say you found a product that you wanted to sell on a Shopify store.
Before you buy inventory or spend hundreds of dollars on Facebook ads, you should ask yourself who might want this product and why.
What problem does it solve? Is the price point right? Is it different enough from other products? What would prevent someone from buying it?
Using AI product concept testing, you can explore all of these questions and then use real customer behavior to validate your assumptions.
Maybe you want to A / B test two product descriptions. Maybe you want to build a landing page. Maybe you want to run a small ad campaign.
All of these things are valid.
The point isn’t that there’s no risk. There’s always risk.
The point isn’t to spend money before you answer the most basic questions you have about your business.
Final Thoughts
You don’t need everything to launch a business.
What you do need is to understand the assumptions that you’re making.
Who needs your product? Why would they choose your product? What would make them not want your product? Most importantly, what would it take to convince you that your idea was worth pursuing?
Use ChatGPT to brainstorm. Use AI simulated focus groups to identify potential objections. Talk to real customers. Do small tests.
Remember, getting positive feedback isn’t the same thing as having a business.
The goal isn’t to get confirmation that your idea is good. The goal is to learn something before you spend your money.
