The difficulty is that good ideas can be few and far between, and it can be challenging at first to distinguish a good idea from a bad one. Moreover, it’s easy to accumulate sunk costs from pursuing a bad idea for too long. That’s why, when developing an idea as a startup or product team, we need to test, test and test some more.
The purpose of testing business ideas is to validate an idea at a minimal expense of effort, time and, importantly, cost. This provides an early assessment of whether your idea meets one of three criteria of good product ideas. These are sometimes called the three lenses; they are that customers find your idea desirable (desirability), that you can build and deliver your idea (feasibility) and, lastly, that you can ensure your idea produces a profit (viability). Strong product teams know that ideas must be tested; after all, building, measuring and learning are key aspects of the lean startup process.
However, many teams go straight to building. Why measure or learn when you can build more and even more?
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Get evidence first.
Please don’t make the mistake of executing business ideas without evidence. This can lead to a concept of false starts, whereby the team has to revert back to an earlier phase in the product cycle to learn more about the ideas they are pursuing, which greatly increases the risk of failure as teams burn through cash quickly — with some startups never recovering from this.
There are many theories of testing business ideas that a product team can use. Some are famous, such as the lean startup method, which uses a series of sprints to test hypotheses from initial conception to full-on build of a product using evidence at its core. There are other practitioners, as well, such as David Bland, who co-wrote the excellent book Testing Business Ideas. He covers this topic in vast amounts of detail but approaches it in a practical format that is easy to use and apply when testing ideas.