Last week, I stumbled across a personal post from a founder on his thoughts after first month of his startup. He writes in the post that he hasn’t been satisfied with the traction received so far and wonders whether existing product is the right path to continue on. I had exact same questions when I was starting up Wingify and now that we have seen some traction, I thought I should expand on a comment I made on how to know if your startup idea is the right one.
When doing a startup, it is perfectly okay to wonder whether you are on the right track. It is not a sign of weakness. In fact, being too attached to one’s idea is a sure shot path to failure. Honest introspection into your startup should be done regularly to have a clearer perspective. After all, startup is a lot of effort and hard work. What good it is if you don’t know whether that effort is in the right direction?
Like many entrepreneurs in their initial stages, if you are feeling doubtful about your startup, ask these 3 questions to yourself (and your co-founder):
- Do you think what you are providing is creating significant value for anyone? Value should be so significant that people should curse you if you take that service away from them. Do you think it could happen?
- Do you think there is big enough market for the service AND the market is easy to reach (without spending bootloads of money)?
- Are you enjoying doing this? Do you see yourself doing this for several next years?
If answers to any of the questions is no, you better think hard about your startup before putting any more effort into it.
As I wrote earlier, a lot of ideas are cool but they seldom provide value to anyone (and hence seldom make money). “Value” is not some abstract concept I am throwing around. Your product/service is valuable if a lot of people will become sad if it didn’t exist or if you take it away from them. Your idea has no value if nobody cares whether it exists or not. For example, you decide to open a cafeteria chain with iPad menus in college campuses. It is a cool idea, for sure. It may even get you on TechCrunch. But, frankly, would your target market bother if such an idea didn’t exist or if you open up one cafeteria and decide to shut it down? The campus crowd has other alternatives for cafeteria and that is why they won’t cringe when you shut it down. They would not bother with your cafeteria. An iPad menu isn’t a strong enough value to anyone.
But, on the other hand, if you decide to open a cafeteria (with or without iPad menu) in a remote locality where there are no cafeterias at all (and if they haven’t tasted coffee before), you are definitely providing significant value to a well defined market. And people will definitely curse you if you decide to shut it down for no reason.
So, as a startup founder, you must ask whether your product/service is providing real value to anyone. Value can be measured in terms of convenience provided, money saved, entertainment, time saved or other parameters. But litmus test for your idea should be this: if you decide to shut down your product/service for no reason, will people notice? Will people become sad/mad, or will they simply move on without much of a fuss? If your answer is no, you better move on.
Realistically reaching a big target market
Just providing value is not enough for a startup. You may have the most valuable idea of all time (like introducing coffee to a remote locality), but if your target market is small, hard to reach or non-existent, then you should think twice about that idea of yours. To give a simple example, if your idea is to open a fast food joint that also serves chilled Cola in middle of Sahara desert, it is indeed quite valuable. You will be guaranteed a customer, every time someone happens to be crossing the desert. But the point is, how many customers would you be able to serve? How big could such business get?
Another example is of a market that is big but incredibly hard to reach. For example, an English teaching course for low-income, less-educated people in countries like India, China, Russia, etc is a brilliant idea and I am sure such a market exists and is potentially huge. But reaching out to such a market is a marketing nightmare. You must be prepared to spend lot of money on TV, radio, newspaper campaigns and establish local centres across hundreds of cities. As a bootstrapped (or even VC-funded) startup, are you prepared and capable of taking such a challenge? If answer is no, you need to move on.
Are you enjoying this?
Startup is a big commitment in life, and choice of your startup idea will determine how maximum portion of your immediate life will be spent. It is true that generally people work on startup ideas they generally like, but there are market-based approaches to find ideas that can be profitable (but not necessarily in line with what you like). You must realize that next few years will be spent on the same startup idea, so you must enjoy doing it. If your startup is about health, you must enjoy being in that field. If it is about marketing, you must like marketing. If it is about bingo cards, you must be passionate about bingo cards. I’m not saying you have to be crazily in love with your industry/domain, but you must at least enjoy being part of the industry. Otherwise, if you do a startup just for money, you will quickly bore and burnout yourself. So, even if your startup can make you a billionaire but you don’t like it (or can’t imagine making yourself like it ever), don’t do it.
Your startup idea is worthwhile if it is: a) extremely valuable to target customers (and not merely cool); b) has a big enough market that you can realistically reach out to; and c) something you can immerse in for many, many years to come.
Otherwise, simply pivot or redo the idea. It is never too soon or too late to change paths in life.