Starting a business is about having an idea that solves a problem and the scale of the problem. This is because, an idea only holds value if it solves a problem that enough people have and if these people are willing to pay to have this problem solved. So how can an aspiring entrepreneur move from desire to having a viable value proposition?
I have summarized this in what i coined 3Vs to value proposition as described below:
- Venturing
How does an aspiring entrepreneur begin the journey, how doea one start the process of getting these profitable business ideas.
To find a profitable business idea, find a problem, to find a problem you can do the following:
- Develop a curious mindset and observe things around you
- Question the status quo always and ask how things can be done better, faster, simpler, easier or cheaper
- Social Media is one place where you can get ideas from. Many people use social media as a medium to vent about their problems and complaints, what can you glean from this
- Speak to people, ask them about their complaints or pain points
- If you’re working in a corporate environment start taking notes of the inefficiencies and problems you and your co-workers face, or the gaps that you see in service delivery of your organization to customers , or how you can apply the business model in your organization to address a problem in another sector.
- Ask your colleagues about the hardest part of their job or the frustrations they face in carrying out their jobs
- Viability Assessment
Once a problem has been identified, the next step is to ask a few questions to ascertain the viability
- How painful is this problem?
- How many people are experiencing this problem?
- How much will your solution reduce the pain?
- How feasible is your solution?
To ascertain how feasible your solution is:
- Identify your ideal customer
- Do some research to find how to reach your customer
- Engage your potential customers to find out if your idea has any weight. This can be done via email, social media, online forums e.t.c This is an important step as it helps you to understand and uncover different layers to the problem and determine which niche you want to focus on and how you want to uniquely and profitably address the problem.
- Validation
The last stage is to validate your idea and solution. An this could be done in a combination of any of the following ways
Google trends
Google Trends is a website by Google that analyzes the popularity of top search queries in Google Search across various regions and languages. The website uses graphs to compare the search volume of different queries over time. You can use this to understand your target niche and what the trend is with your niche over a period of time
Problem Discovery interviews:
These are face-face interviews that help to do a deep-drive to further test the problem definition. Ask open ended questions that help understand the problem. A common practice I like and often advice is the use of “5 Whys”. Wikipedia defines 5 Whys is an iterative interrogative technique used to explore the cause-and-effect relationships underlying a particular problem. The primary goal of this technique is to determine the root cause of a problem by repeating the question “Why?”. Each answer forms the basis of the next question. The “5” in the name derives from an anecdotal observation on the number of iterations needed to resolve a problem.
Not all problems have a single root cause. If one wishes to uncover multiple root causes, the method must be repeated asking a different sequence of questions each time. The method provides no hard and fast rules about what lines of questions to explore, or how long to continue the search for additional root causes
Pitch your solution
Pitch your solution to at least 20 potential customers. Tell them about how your solution solves their problem and the associated costs for the solution. The objective is to get them to buy or preorder your product. That customers like your product is different from them willing to buy your product.
Offer your solution free to potential customers
People love freebies, so depending on what solution you are providing, you can host a giveaway to see how many people show interest in your solution and you may use this to get feedback to fine tune your solution. This may also serve as a marketing tool.
Those are my thoughts on how an aspiring entrepreneur can move from desire to having a viable value proposition. What other thoughts can you share from your experience?