Future Certified™
Idea Validation
I have a dream
You were just blessed by the idea that going to change the World and definitely your future... Hold on. I always say that you need a dream, a big dream, much bigger than you. Dream, but at the same time you can be very realistic, very practical because you want to be one of 10% startups who survive and not one of the other 90%.
3 most important things in entrepreneurship
Relevance
Your idea not only needs to be relevant, it includes your flexibility and adaptability in order to keep it relevant. Relevance is a great idea versus what people need.
The right team
People with passion, vision and self-belief, able to run a marathon in the team. Passion, skills, engagement, dedication and persistence lead your team to success.
Management
Although you have relevant idea and a good team, you have to manage your time, actions and money. It is everything from defining MVP to managing your cash flow.
Idea validation questions
Let me share with you this list of questions. Spend time to check if you have the right answers for each and everyone because your investor most probably will ask these questions. Alternatively, reality will force you to get answers. Good luck.
1. Overview
What does the company do?
What is unique about the company?
What problem does your product solve / market need does it fill?
How big is the market opportunity?
Where are you headquartered?
How big can the company get?
2. Market
What is the actual addressable market ?
What is the size of the market that will buy your product or service?
What percentage of the market do you plan to get over what period of time?
How did you arrive at the sales of your industry and its growth rate?
Why does your company have high growth potential?
Can you name somebody who would benefit from your product or service?
3. Founders & Team
Who are the founders and key team members?
What relevant domain experience does the team have?
What key additions to the team are needed in the short term?
Why is the team uniquely capable of executing the company’s business plan?
How many employees do you have?
What motivates the founders?
Do you have a mentor or industry advisor that you can call on?
How do you plan to scale the team in the next 12 months?
Who are your design partners and why?
Who are your advisory board - business, domain experts - and why?
4. Products, Services and Roadmap
What problem /market need does your product solve?
What is the main contradiction you address?
Why do users care about your product or service?
How have others attempted to solve this problem before, and why did their solutions succeed or fail?
Does your idea already exist in the same way you were going to create it?
How many specific benefits for your product or idea can you list?
Can you state, in clear language, the key features of your product or service?
What are the key differentiated features of your product or service?
What are the major product milestones?
What are the two or three key features you plan to add on each milestone?
What have you learned from early versions of the product or service?
Provide a demonstration of the product or service.
5. Resources
Do you have access to the various resources you need to launch a business?
Do you have distributors or partners to help you scale your business?
What would it take to build a minimum viable product to test the market?
Can you produce the actual product yourself, or do you have a partner who can?
6. Intellectual Property
What key intellectual property does the company have (patents, patents pending, copyrights, trade secrets, trademarks, domain names)?
What comfort do you have that the company’s intellectual property does not violate the rights of a third party?
How was the company’s intellectual property developed?
Would any prior employers of a team member have a potential claim to the company’s intellectual property?
7. Competition
Have you done a SWOT analysis?
Who are your potential competitors?
What gives your company a competitive advantage?
What key features does your product or service have that others will have a hard time copying?
What advantages does your competition have over you?
Compared to your competition, how do you compete with respect to price, features, and performance?
What are the barriers to entry?
Marketing and Customer Acquisition
How does the company market or plan to market its products or services?
What is the company’s PR strategy?
What is the company’s social media strategy?
What is the cost of a customer acquisition?
What is the projected lifetime value of a customer?
What advertising will you be doing?
What is the typical sales cycle between initial customer contact and closing of a sale?
8. Traction
What early traction has the company gotten (sales, traffic to the company’s website, app downloads, etc., as relevant).
How can the early traction be accelerated?
What has been the principal reasons for the early traction?
Have you reached out to potential customers for feedback?
Can you set up a landing page and encourage interested people to sign up for more information?
Can you get paying customers from your target market to pre-order based on a blueprint or mock-up?
9. Risks and assumptions
What do you see are the principal risks to the business?
What legal risks do you have?
Do you have any regulatory risks?
Are there any product liability risks?
Describe your assumptions used for the solution feasibility.
Describe your assumptions used for market estimation.
10. End Game and ROI
What will it take to break even or make a profit?
How can investors in your idea make a profit?
What is the likely exit – IPO or M&A?
When do you see the exit happening?
Who will be the likely acquirers?
How will valuation of an exit be determined given market comparable?
10. Financials
What are the company’s three-year projections?
What are the key assumptions underlying your projections?
How much equity and debt has the company raised; what is the capitalization structure?
What future equity or debt financing will be necessary?
How much of a stock option pool is being set aside for employees?
When will the company get to profitability?
How much burn will occur until the company gets to profitability?
What are your unit economics (business model per unit)?
What are the factors that limit faster growth?
What are the key metrics that the management team focuses on?
11. Financing Round
How much is being raised in this round?
What is the company’s desired pre-money valuation?
Will existing investors participate in the round?
What is the planned use of proceeds from this round?
What milestones will the financing get you to?
If you’re a business, talk about how you started and share your professional journey.
Explain your core values, your commitment to customers and how you stand out from the crowd.
Add a photo, gallery or video for even more engagement.