#1 Identifying and Assessing the Idea
Mapping Need-Gap to Idea
The primary challenge for an entrepreneur is often ensuring that he/she has a viable business idea, which is largely dependent on the ability to identify a gap in the market that presents itself as an opportunity.
How to get a startup idea
The first step for an entrepreneur, before starting a new company, is finding the right idea for the startup. The best way to get good startup ideas is not to try to think of startup ideas – that would be the wrong way to start. The best way is to look for problems, preferably problems you have faced yourself. However, it does not necessarily have to be a problem you have experienced personally. It could be something you have seen other people, your friends or family, face regularly.
Why is it better to work on such problems? Among other things, it ensures the problem really exists. It sounds obvious to say that you should only work on problems that exist. And yet, by far the most common mistake startups make is to solve for problems no one has. You should aim at solving a problem that you’re sure exists, and attempt to solve the problem, or attempt to recreate an experience that betters what an individual or a business would be going through today.
After identifying a problem or need-gap, as an entrepreneur, it is important to assess your venture idea. To do so, you should aim to get answers to the following questions:
1. Technical & Market Feasibility (Does the need exist?)
- What pain point are you solving for?
- Who are you solving this problem for?
- How are you going to solve the problem?
- Is anyone else doing it? How are customers currently solving for their problems?
- Can you do it differently from them?
2. Financial Feasibility (Can you monetise the idea?)
- Would your customers pay for your solution to the particular problem?
- How big is the market? How many customers would potentially pay for your solution?
- Clearly express your venture idea based on the pain points/experiences you have, or someone that you know has faced.
- Conduct a technical and market feasibility of your venture idea and define the following:
- Pain point you are solving for
- The customer you are targeting
- The solution you have arrived at
- Competition and current alternative for customers
- Sources of differentiation against your competitors
- Conduct financial feasibility of your venture idea by assessing:
- Ability to monetise the idea
- Depth of the market
Startup Story for identifying and Assessing the Idea:
The founder of Saavn was a music lover and grew up listening to Indian music. He saw that in western countries a lot of content especially music was going digital. But then, he noticed that in a country of a Billion people, where people are music fanatics, music was not digital. And he decided to act upon this pain point and took South Asian content digital on their online platform to fill this gap in the market. The pain points we face in our daily lives, whether at work, at home, or in certain situations and under specific conditions, are often the best source of Need-Gap identification for new venture ideas. A Need-Gap is most of the times driven by these very simple pain-points. Let’s hear from Phanindra Sama of redBus and Girish of Freshdesk to get an understanding of this.
Assessing the Idea you have to ask some of these questions.
- What pain points or problems are you trying to solve with your venture idea?
- What experience or observation led you to this idea? Did you face the experience personally?
- Write down your idea to address these problems in the most concise yet effective way. E.g. redBus = Provides information about bus ticket options and allows seamless booking of tickets on its platform.
- List down the assumptions that you are making about the problems, target group facing these problems, and your solutions. (Example: In case of redbus, one of the assumptions was that bus operators would accept and adapt to online bus ticketing)