How to Validate Your Business Idea: The Lean Startup By Eric Ries

Starting a business is a very daunting task. However, with this week’s tips, you can start by validating first your business idea before you even go full blast with your business. Here are some tips from the book The Lean Startup by Eric Ries:

Draft the User Experience Vision. It is crucial to develop the journey of the user. If possible, draft it with functional specifications and UI/UX wireframe. It will serve as a high-level plan, so you will be able to consider all aspects that you can offer to your target market. The photo below is the actual brainstorming notes for our Snap Accounting project at Hilsoft.

Identify Critical Assumptions. With Snap Accounting, we assume that small businesses, who want to make their back-end transaction processing efficient, are not tech-savvy enough to setup existing self-service accounting platform. So our critical assumption is that they will need a platform where they can start to record their invoices or checks in a snap.

Build an Early Version to Validate a Critical Assumption (Concierge MVP, Smoke Screen MVP). In 2016, we started by forking the accounting module from our existing ERP suite. We quickly replaced the UI/UX but launched it without the self-service option yet. We offered it to accounting firms but did the customer onboarding manually. That is the concierge Minimum Viable Product (MVP) approach. The smokescreen MVP is where you develop marketing campaigns without a finished product yet. It is like a pre-selling or pre-order style of MVP.

Release and Measure. After reaching 100 active users in the Concierge MVP of Snap, that’s the time we developed the self-service option (hilsoftsnap.com). We are now in the process of posting online ads and measuring the feedback of the market. At the moment, we get about 5-7 new registrations per week, with about 1-2 accounts that remain active.

Pivot or Persevere. This stage is where you do iterations in your product and tweaks your marketing efforts. I recommended that you continue to do that cycle until you reach your ultimate goal of either your revenue goals or investment for growth. Perseverance is the key.

Leave a Comment

Your email address will not be published. Required fields are marked *