It’s one of the classic phrases of the startup universe. We’ve all heard it a million times. It’s so ubiquitous, it inspired a Cards Against Humanity card:
“I have a great idea for a startup.”
If you’re anything like the Startups team, chances are you’ve caught yourself saying this more than a few times. If you’re really like the Startups team, you find yourself saying it a few times a day.
But what exactly is a “great idea?” How do you know when that idea you scribbled down on a cocktail napkin or a post-it note has the makings of a full-blown business? Is it really just a matter of “you know it when you see it”? Or is there more to it than that – something structured and systematic, a template of sorts that you can follow, time and time again, to evaluate the quality of your ideas?
The Startups Live crew, joined for this session by Mike Stemple and Darshan Mehta, met up to discuss the anatomy of a great idea. What emerged was a “great idea roadmap” of sorts – a series of steps you can follow to test whether your idea has the power go the distance.
Roadmap for Recognizing Great Ideas
How do you even know whether an idea is worth pursuing in the first place? The fact is, if you start with that question, you’ll never know the answer – because you’ll kill every idea before it’s even really an idea.
Before you can start the process of evaluating an idea, you have to give it a chance to get out in the world, judgment-free. Jot it down. Keep a notebook or a Google Doc file with all of your ideas and revisit it from time to time whenever you have some downtime or need some inspiration. Notice the ideas that jump out at you, that rise to the top – the ideas that won’t leave you alone until you do something with them. Those are the ones you want to take to the next step.
We tend to think of “great ideas” as these ephemeral things, where you just have to open your scalp to the gods and wait for a great idea to plop in. And it’s true that inspiration will always be a factor. But the real test of the quality of your ideas is where you take them. Once the idea is captured, that’s when you start pulling and pushing at it, seeing how it stretches. And for that, a little process goes a long way.
There are all kinds of tools and frameworks out there for clarifying and solidifying ideas. And no, we’re not talking about the dusty old standby SWOT analysis.
Mike Stemple shared a framework he and the Inspirer team use for fleshing out ideas that might be worth pursuing:
What the Inspirer framework does, essentially, is set up a series of productive questions you need to be able to answer about your idea before it can be ready to move forward. Who is this for? What value does it provide? Where will it be offered? Why should people choose it over something else? The framework is set up to help you engage with your idea on a number of different levels – factual, predictive, analytical, synthetic – giving you a dimensional view of your thinking about your idea and the problem it solves.
Frameworks like this are great because they help give structure to your ideation. The myth of creativity as an unstructured phenomenon is just that – a myth. The most creative people rely on structure to fuel their creativity. Just look at Google, with their famous “8 Ideas for Creating a Culture of Innovation” and Five-Day Sprint methodology.
By setting up guardrails like the ones Mike’s framework provides, you give yourself the freedom to focus on the content of your ideas, rather than the logistics of how to get them from point A to point B.
A simple but easily overlooked test to run early in the idea development process: how much do you care about this idea?
Too often, entrepreneurs will ask every other question under the sun about an idea before they ask themselves whether they are passionate about the idea, and as our CEO Wil Schroter can attest from experience, that’s not a good situation.
“I’ve worked on multiple projects where it was a good idea that had zero passion from me,” Wil says. “The downside to that is when things go south – and they always will for some period – it’s hard to press on. Whereas when you have a genuine passion for something, you’re more willing to overlook the crap because you’re so pumped about what you’re trying to create.”
“When you have a genuine passion for something, you’re more willing to overlook the crap because you’re so pumped about what you’re trying to create.”
Life is too short – and building a business is too hard – to drag your butt to a computer every day to work on something you’re not passionate about. If you’re looking at that idea on the page and it doesn’t sing to you, put it down – or pass it on – and move on to that idea that won’t leave you alone until you do something about it.
There’s a flip side to this point about making sure an idea is right for you: you also have to make sure that you’re right for the idea.
As Ryan Rutan, Chief Innovation Officer at Startups.co points out: “I have ideas all the time that I know I’d be totally unfit for.”
Sure, you might think a jetpack company is a cool idea. But do you have the technical expertise to build a jetpack? Do you know anybody who does? If you’re not building the jetpack, what are you bringing to the table?
You know enough about yourself to know whether you have the knowledge, the skill, the motivation, and the network to make it happen. If you don’t, own up and move on.
Basically, what this whole step boils down to is being honest with yourself – about where your passion is, about what your strengths are, and about how far you can stretch the limits of both in the name of a “cool idea.”
There’s only so far you can take an idea in the echo chamber of your own mind. At a certain point, you have to offer it up to the firing squad and see how well it deflects the bullets. So once you’ve clarified your idea as much as you can for yourself, it’s time to shop it around and see what others think.
This doesn’t have to be some formal ritual. It can be as casual as chatting with your buddies next time you’re out for drinks. For Ryan Rutan, it’s an “informal sounding board” of about 8 people whose opinions he trusts, who he routinely texts with tweet-length versions of ideas to get feedback.
Don’t be afraid to beat it up a little. Kick the tires, see if it’s road-worthy. If it fails the test, then guess what? You’ve saved yourself a lot of wasted time and energy.
Take your ideas to people whose opinions you value, who you know won’t be “nice” because they’re afraid to hurt your feelings. Ask them to use your idea for target practice. Don’t be afraid to beat it up a little. Kick the tires, see if it’s road-worthy. If it fails the test, then guess what? You’ve saved yourself a lot of wasted time and energy.
Even better than kicking your ideas around with your friends: kicking them around with experts. As Mike Stemple puts it: “Get lots of answers quickly from people who have been there, done that.” Like your friends, experts might see something that you don’t – and their insights will come with the weight of experience. They can point out potholes because they’ve fallen in those potholes themselves, or warn you away from a misdirected idea from the start – again, saving you a lot of grief and wasted time in the long run.
As you’re going through this process of socializing your ideas, be mindful of whose opinion matters – and whose doesn’t. A particular group of folks whose opinion maybe doesn’t matter so much at this early stage: investors.
With as obsessed as startup culture has become with the idea of venture capital as the express route to success, too many would-be founders start their ideation with the question: “Is this an investable idea?” We’ve all been trained, to varying degrees, to think that what an investor thinks of an idea is the true measure of its merit. But nothing could be further from the truth.
If you’re evaluating the quality of an idea based on its “investability,” you’re putting the cart before the horse, and that cart will almost certainly run you over and flatten you. Investment doesn’t drive great ideas – great ideas draw investment. Keep your eye on the prize. In the immortal words of Field of Dreams: if you build it, they will come.
Your own passion and the support of friends and mentors are all great, but if a business could live off warm feelings alone, then maybe Pets.com would still be around.
At the end of the day, sales and profits are going to be what keeps your business alive. And the only way to know if sales and profits are in your idea’s future is to talk to the people who will ultimately offer it: customers. Yes, we’re talking good, old-fashioned customer validation.
“Engage with real users even before you make a prototype or go to beta… Skipping this step could be the difference between making it or failing.”
“The most efficient path to prioritize ideas is to engage in meaningful conversation regarding your idea with target customers,” Darshan Mehta observes. “Engage with real users even before you make a prototype or go to beta. It will save time and money in the long term and most likely avoid some serious missteps. Skipping this step could be the difference between making it or failing.”
Talk to customers. Like the “make sure you care” point above, it’s surprisingly simple – and surprisingly easy to overlook. Too often, would-be founders skip over customer validation in the early stages, meaning the first time they actually test whether there’s an appetite for their product is when it’s already built and they’re trying to convince people to use it. Which is, to put it mildly, too late.
So talk to your customers. Ask them what their pain points are. Ask them what they want. And don’t just talk – listen to what the answers are. “Listen more, talk less,” is how Darshan puts it. “Really listen, and ask pertinent questions to get at the core of user needs, motivators, and desires. Get to know their pains and develop empathy to really help, as opposed to just trying to sell.”
A lot of the time, good advice is contradictory, and this is one of those times. Because the real advice when it comes to listening to customers is “Listen to customers – but don’t listen to customers.”
“Your job as an entrepreneur is to uncover the underlying problem so that you can provide a good solution.”
“Talking to customers and potential customers is very, very important, but they tend to answer questions with half-assed solutions,” says Mike Stemple. “Your job as an entrepreneur is to uncover the underlying problem so that you can provide a good solution.”
As important as customer input is, it should never trump your instinct and judgment when it comes to developing an idea. Some of the greatest products in the world are solutions to problems people didn’t even know they had. As you’re listening to customers, listen for the thing they’re not telling you – that’s where your value as an entrepreneur comes into play.
Once you’ve gathered feedback – from friends, from mentors, and from customers – it’s time to start taking all of that feedback back to your idea. And that means getting focused.
“Focus on your core purpose of existing and its alignment with your customer’s needs,’ advises Darshan Mehta. “Focus on the feature that your customers can’t live without and one that you can deliver better than your competitors.”
In concrete terms, what this means a lot of the time is “niching down” on your idea – getting specific about what your product is – and who your product is for.
Sometimes would-be founders are reluctant to niche down and commit to a more focused feature set or target audience because they’re worried about limiting the scope of their idea.
“I hear a response similar to this all the time,” observes Ryan Rutan: “‘But then it would only be useful to [some niche customer segment].’ To which my response is, ‘But then it is really useful and easy to communicate.’”
The fact is that niching down is an essential part of how an idea gets great in the first place. Like systematizing your ideation process, niching down on your idea is about putting up guardrails. There’s creativity in constraint. It forces you to refine your idea down to the hot, burning core of the idea. And that is the spot where the true value lies.
We’ll start this step with a riddle: how are ideas like Pokemon?
Answer: they evolve.
Great ideas are not static things. They don’t spring fully formed from your brain ready to go out and conquer the world – they need time to grow. And, through the process of growing, more often than not, they change on you.
“I’ve never had a successful company that was the exact idea I started with… In every case, it was always some mutant variant of the original idea. But I’m OK with that.”
As Wil Schroter points out: “Ideas iterate and transform quite a bit once actually brought to market. So even with the most determined validation, there’s a fairly good chance whatever you think is the right product will change a bunch of times anyhow.”
That’s the voice of experience talking, folks. “I’ve never had a successful company that was the exact idea I started with. I’ve built 9,” Wil goes on. “In every case, it was always some mutant variant of the original idea. But I’m OK with that.”
The fact is, most first startup pitch decks don’t survive first contact with customers. Don’t cling so stubbornly to your “vision” that you stop your idea from becoming the perhaps different but no less awesome thing that it was destined to become.
There you have it: the Startups Live crew’s roadmap to developing a great idea. Get it down on paper. Put it through its paces. Make sure you care, and submit it to the scrutiny of people whose opinions you respect. Give customers a chance to tell you what they think, and use all of that feedback to hone in on a truly own-able, differentiable, valuable direction. And don’t be surprised when your idea mutates into something different – and maybe even better – than you ever thought it would become.
One final note: never be afraid to go back to the drawing board. Every great idea that makes it into the world as a fully-fledged business stands on the shoulders of a hundred other ideas that fell short somewhere along the road. Embrace that.The more times you go through the steps, the more efficient you will become, and the more likely that when the truly great idea comes along, you’ll be ready for it.
Looking for an expert to help evaluate your idea?
Head over to Clarity.fm to find a mentor today.
Got an idea that you’re ready to take from evaluation to execution?
Check out Noor Siddiqqis’s advice on early Idea Execution.
Need help creating a business model that will get your idea the sustenance it needs?
Let Alexander Osterwalder take you through his Business Model Canvas.
Want an example of how an idea can evolve over time?Read our chat with Rich Aberman about the evolution of WePay.
Andy Dunn has spent the past ten years building Bonobos. He’s funded about 15 other ecommerce companies, advises even more, and serves on the board of three others. In this interview, he shares his thoughts on better fitting pants, 100M in capital, and why men should embrace a world run by women.