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Progression of Idea Validation

Having 100 million users and a billion in revenue is a pretty good validation of an idea. However, Rome was not built in a day. Validating an idea and the subsequent products/ startups is best done in stages.

The progression:
  • Idea – Validating an idea requires initial feedback and feel amongst a select group of potential buyers. This can be done via surveys either in small verbal groups or large online surveys. This can also be through the first 10-20 customers where many may be friendlies.
  • Product/ Service – This is the long sought-after “product-market” fit stage where validation comes from the first cohorts of buyers – scaling from 20 to 100 inorganic customers. Depending on the product/ service, engagement metrics may also provide validation.
  • Company – Let’s call this stage the growth stage for a company. At this stage, validation comes from lower customer churn. In many cases, competition will be fiercer here, so churn could be a problem.
  • Category/ Market – There are clear market leaders with more niche players taking the smaller 20% of the market. (Follow the 80-20 rule.)

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