So you have decided to play the ALL IN Game as long as it takes!!
Get your Idea Validated!!
If i go back and check many an ideas which doesn’t makes any sense to me,which was known to me when it was at the ideation level,i can divide it broadly into following categories.
2/Non Revenue Visibility
Copycats are simply the business model which was launched elsewhere and try copying that to India.There is no Problem in that.In fact Samver Brothers Become Billionaires only because of that.The Problem with our Local copy cats are they don’t know any idea on how to build Tech,How to Launch and How to Scale!!
They speak as if they have invented this Problem and the solution where in they are mere identifiers of the business model which is successful elsewhere.
Non Revenue Visibility:
Lets understand one thing clear.Not everyone is Mark Zuckerberg and Not every Project is similar to Facebook.And there is Nothing wrong about it!!
The problem is Because the idea is kinda exciting,People don’t even have an idea on what kinda revenue model they can build upon over the time.and when you speak to them,they will more or less come back with a Sarcastic Answer Stating that”Even Facebook don’t even know How to make revenue for couple of years”
Many an ideas Even though Beautiful and logical ,the serve a smaller audience.After Certain levels scaling won’t be possible.Im of a View,As on date,any business which don’t have an ability to scale constantly can’t sustain.
(Please note my inferences/opinions are only for tech startup’s and not to be confused with conventional trading and other businesses).
Business models like selling medicines online, selling liquor online,selling land in mars, Teaching Swahili or Gabonese from india, trying to build a copycat online business competing with Amazon and Flipkart are some to name a few.,
The common thread between all the above is,none of it is connected to reality and they haven’t took even a moment in checking whether their business model is viable for a country like india,or whether they really have an ability to take on those giants!!!!
I very strongly recommend validating your business model not only at the start but at every now and then!!
I learnt it a hard way!!
My first experience on sales happened with a Paging company in Chennai and Paging was a Buzzword and New Tech gadget before Cellular Phone.
I was overwhelmed for the fact that i got a job in Chennai as i haven’t even completed my Bachelors Degree.There is a team of close to 200 People who sells daily 1-3 Pagers for a monthly subscription.
The company where I worked,speak about how paging is useful for people to get connected,and every week on the sales meet we are forced to share the experiences of the customers on how paging changed the way they communicate,to which often we cook up our own stories!!!
In parallel cell phone got launched,and after 3-4 months one day my manager called me and shown a simple feature on cell phone where in instead of calling some one where the call rates where 8 Rs for incoming and 8 Rs for out going,you can send an alpha numeric message for free.
YES.on very initial days SMS was offered as Free Service.Mobile companies concentrate only on Voice calls and were not focusing on the SMS at that point.
He asked me what if people start using this instead of Calling a number and leaving a message which further sent as a text to the pager to which the receiver can’t respond back.
Next one hour we debated, and he was quick to get the info on how the service is used in developed countries and why he thinks Pager as a business won’t survive!!
Next day he resigned and in a week i resigned!!!
Similar to that when we started EBS we are fortunate to have Kanubhai as our Investor.When we presented the business.I was like the idea will work,and I wasn’t kinda even bothered to validate.The first thing what he did was to go and meet multiple consultants with us to validate whether what we are thinking is right or not.i used to laugh at him internally that he is wasting time and money as the consultants used to charge a bomb those days for an hour or two consultation.and he use to make notes on those points and recheck the other consultants view point on the things which he got from the first one.
There are some very genuine advices to him from his well wishers,where in they told “why are you trying to get into something which you Don’t even know and understand”.He is 60+ that time and when i think about it now,thats the most realistic advice someone will give if they are genuinely concerned about the well being of the other person.i actually become restless hearing all these comments!!
He got all the inputs and he decided to go ahead with the project!!
It took long time for me to realise i was completely wrong.
I’m not saying that we all need to validate our ideas based on others inputs.To validate,you need to have enough Data.you get those when you speak to People.You get those when you collect data from the market.you get those when you start comparing your idea with similar ideas which is already there in the market!
This exercise enables to first identify and validate what you are doing and secondly to alter things at the earlier if it needs to be.
While I’m novice to comment on how Biggies have spent millions of Dollars on a business without realising its validity,i realised one thing very strongly that i won’t venture into anything without knowing the validity of it.
Even for Payswiff,almost 3 out of 10 people we met in initial days which is 4 years back predicted the wipe out of Plastic where we as a team, at times become sceptical as at times we get those inputs from some very reputed industry veterans.
What helped us is our ability, to validate those statements than we taking it on face value of it!!
Today thats also a reason we are building Payswiff as a Platform agnostic,Payment methods agnostic,form factor agnostic Payment Processing platform!!!
Coming back to validation,what i mean by validation is the following
1/How big is your addressable Market?
2/What are the influencers for your buyers to adopt to your or similar product/Service?
3/Whats your unique selling Point?
4/How you can differentiate from your competitors in your offering?
5/How long you think you need to play in order to succeed?
6/How viable is your service for customers Technically, commercially and conveniently?
7/what kind of revenue you can foresee and do you see a possibility of growing your customers and Revenue constantly for next 10 years?
8/How many similar or Near Similar models are successful elsewhere and what are the reasons for those models to be successful?
9/is there any other monetising options available which will increase your revenue per customer or you need to grow your business only thru the organic way?
Its not important to get an answer or YES for all these questions at the good start but its very important for you NOT to get a NO for any of these questions!
And lastly Validation is a continuous process as the market is bound to change continuously.I very strongly recommend to do this in continuous intervals which helps you first to identify how relevant your business is to the market and also what are all the new branch out opportunities you have in scaling it!!
Share your views!!!