4 Misconceptions about Startup Idea Generation
By: Joanna Liu
If you’re an entrepreneur, you understand the struggles of startup idea generation. You and your team bounce startup ideas off one another for hours, yet cannot seem to find the “perfect idea”. Everything you come up with has some flaw whether the concept won’t make enough money, will be too challenging to make, or not exciting enough. Even when you think you’ve come up with something extraordinary, a quick Google search may show that someone else has already done it better than you can.
Just like money, good startup ideas don’t grow on trees.
Even so, there are good and bad approaches to the idea generation process. The bad approaches can prevent you from generating good ideas, or even worse, cause you to invest incredible amounts of time and money into something people don’t want. On the other hand, efficient methods of idea generation can help your business gain traction, customers, and investors.
Misconceptions about Startup Idea Generation
Misconception #1: Any innovative product will do well!
When Google Glass was announced in 2013, the company advertised the product enormously — through 12-page Vogue Spreads, celebrities, and news show features — in hopes of creating the next tech success. However, the Google Glass was not received well by the general market. The prototype was discontinued in 2015, less than two years after its release.
Yes, Google Glass was an innovative product, developed by one of the biggest tech companies of our time. But an innovative product is not all that is necessary for success. Google failed to validate a problem. That is, the company did not identify a specific challenge its customer base was facing. The Glasses’ wifi, bluetooth, and camera functions were creative, but their customers had the same features on their phones without the clunky headset or steep price tag.
When developing a product, it’s not always about how cool or advanced it is — it’s about making sure it serves the target demographic. Thus, it’s important for entrepreneurs to build a value proposition: a statement which clearly identifies the value a company’s products and services will offer to its customer base.
Misconception #2: It needs to be innovative
While it is absolutely enouraged to look up your idea to see what potential competitors are doing, do not get discouraged by the existance of competition! Your startup idea does not need to be something that has never been thought of before. In fact, evidence of competition is actually a good thing, since it proves that there is demand. You can learn from what has been done by these competitors, their feedback, and how well or poorly they are doing, to influence your decisions.
Keep in mind that if you go the route of an uncontested, growing market, you may be developing a ‘blue ocean strategy.’ This is the creation of a new market like how Netflix, Uber, and iTunes created an entirely new market, though keep in mind that these require a lot of customer education and therefore significant investment cost to capture that market. These opportunities tend to be rare relative to the opportunities to innovate within existing markets.
Misconception #3: I don’t need research!
No matter how great your team is, you’ll always need to research to understand who you’re selling to and, thus, what features your product should have. Without interacting with potential customer segments, you won’t know if your customer truly loves the product or service until you’re pitching to investors or already on the market — by then, it’ll be too late or too costly to make significant changes to the product. Please don’t wait until it’s too late to make these changes!
As stated by former LaunchX team Bridgin’, which seeks to address loneliness in the elderly and help them find real therapists in post-pandemic years: “You need customer feedback to make a product that people want and need. Don’t be discouraged or surprised when you have to change your idea after more interviews. It’s a part of the process.”
Doing research on your customer base and their background is a non-negotiable step. This is true even if you’re in your target market, since you cannot assume that your experience is the same as that of everyone in your market. Plus, keep in mind that user testing is one of the best forms of market research!
Misconception #4: It needs to be perfect!
Your idea does not — and should not — need to be perfect. Develop your proof of concept as a rough draft that demonstrates the feasibility of your service sticking to the essential, bare-bones features of your product or service. Remember that the goal is to gain feedback, revise, and improve your product. If you choose to polish it beforehand, not only will it take up unnecessary time, but you may also alienate yourself from the market.
You will then test early and often, collecting data on what matters most to your customers and adjusting as needed.
Key Startup Idea Generation Takeaways
With every misconception, there are lessons to learn and grow. Here are three top tips on generating with good ideas.
- Develop ideas with a purpose: make whatever you develop compatible with the target market’s needs. Ask questions like “What do they REALLY need?” or “How can I provide this?” Have a specific value proposition will also help you develop better ideas.
- Know the market: conduct market research to confirm that your product or service solves an existing need. I’d suggest interviewing people from your target demographic by asking them to give feedback on your ideas. Another aspect of market research is knowing your competitors and analyzing the ways their solution meets or fails to meet market demands. This way, you can tweak your product early during development to accommodate market interests and differentiate the product.
- Revise, Revise, Revise!: You should always revise your product. It’s ok if the first iterations or features are rough around the edges. The goal is to constantly receive feedback before showing it to important investors or putting it on the market.
Stay tuned for more on the entrepreneurial process next week or get started on your LaunchX application today.
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