The 4 Things You Need to Validate Your Business Idea

There's nothing more exciting than starting on a new business idea...

All the success, money and freedom you can achieve when it all works...

You think you have a great idea, you’ve asked a few friends and they think it’s a great idea… so it’s a great idea, right?


The reality is that MOST businesses fail because they don't gather critical information from their customers and validate their assumptions BEFORE they start.

This seems simple right? Just gather some data before you start to make sure you're making/providing something people want?

So why do so many entrepreneurs miss it and end up realizing their core assumptions about who wants to buy their product/service and WHY those people want to buy are totally wrong?

It's for 3 reasons:

1) They don't understand what information they absolutely NEED to gather

2) They don't know how to gather that data effectively and how much they need.

3) It's hard, and it means putting yourself and your idea out there...

You can't rely on your friends and family telling you that your idea is great.

And let me be clear, if you don't take the time to do this up front, it could end up costing you a lot down the road.

So here are the four simple steps that we've used over-and-over to discover what our customers actually want and validate that we have a winning product or service.

We have used this process first-hand. Including the Browluxe precision pencils that took a LOT of market research to ensure the packaging, quality, shades and overall brand was exactly what we dreamed of and wanted people to be excited about purchasing.

Here's what you need to do:

#1 Define what you think your value proposition is, who you think your customers are, and your assumptions

Value Proposition: What is what you are offering that is UNIQUE and of value to your customers. Your value proposition is the most important message you have and it you should be able to articulate it in 1-3 sentences.

"Company XX allows these specific types of users to do XX 10x faster/cheaper/better than doing it the current way"

This is a simple example but it hits the most important points: what you provide, why it's better, and who it's for.

We're going to test all areas your value prop and adjust if need be.

Customers: Who do you think your target customer is? Be specific.

Why do they want to buy your product/service? What PROBLEM are they solving. Try to define that problem.

It’s also great to create a persona of your ideal customer.

Here's and example for the Browluxe pencils her name is Veronica, she’s 26 and just graduated University. She likes going out for dinner with her friends and lives in a two-bedroom condo with her boyfriend and dog. She’s active on social media and likes to support local brands… You see where this is going? We’re now filling a need for someone specific and this can help us to get more clear on the details for how to best reach and target them.

You may have more than one target customer type. Make a profile for each of them.

Assumptions: Document any other assumptions you have about your customers and market. Eg. Customers prefer to buy like this, customers don't want that, customers care about this.

Want to learn step-by-step how we discover exactly what our customers want?

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#2 Ask your customers

This is the part that most entrepreneurs crash and burn on. Customer Discovery.

I actually have to talk to my customers before I have a complete product/service? What?

Yes, and you have to talk to a bunch of them too...

You need find a representative sample of your customers (at least 50 but ideally 100 of each customer type). Seems like a lot, but that's the only way you'll start to understand what generally these customers like, dislike, want to buy, and problem they're solving.

The way you do this will depend on your business. If you are running or plan to open a local salon for example, you can most easily accomplish customer discovery by meeting face-to-face. If you're exploring a business-to-business product or service, you'll need to identify your target companies and the people inside that will be the user of your product/service.

What questions do I need to ask? Here are a few of my favourites:

  • Are you already a customer of this type of product or service?
  • If not, is this type of underlying problem (insert the assumed problem) relevant to you? Why or why not?
  • If yes, what/who do you view as the best solutions or companies offering a solution to the problem?
    Which of those specific solutions/companies do you use today?
  • What do you pay for it today?
  • What do you like and dislike about the current solution/company you use today?
  • What would an ideal solution/product/service look like?

I have more questions... click here to get the full list

Get the full list of questions

The best way to get people to talk to you and get the best responses is to not sell!

#3 Learn and adjust your approach

Once you've spoken to between 50 and 100 target customers from each of your customer profiles, you should have a pretty good idea of what you got right and what you got wrong in your assumptions. Find the commonalities of what customers like, don't like, how they want to buy, and how much they're willing to spend. Then "pivot" your approach to offer a product/service they can't say no to.

You'll also have a better idea of what key messages will work for your customers. Tailor your marketing messages around the customer pain points and what they want from a solution.

As an example, when we were first testing our Browluxe® Precision Brow Pencil we received feedback that the initial product looked too “medical”, so we modified the packaging and overall product to look more approachable, while maintaining a high quality image for a high quality product. We also learned that understanding what shade was right for our customers was important, so we built messaging and tutorials around how to find the right shade.

#4 Validate customers will take action

At this point, if you've done the work in the previous 3 steps, you should feel confident that the target customers, value proposition, and approach you've defined are correct and that people will buy what you're selling. It's time to test that.

The most important thing at this stage is that you don't yet have to have your business operational or product/service designed. In fact, you should do this BEFORE you invest a lot of time or money in starting your business. What we want to gauge in the validation stage is that customers will take action. That action can be a range of things from signing up to learn more to taking pre-sale orders.

Here's an example from browluxe® cosmetic brand. We started by talking to customers in our studios when we though there would be demand for an eyebrow pencil that was professional quality but longer-lasting and at a more reasonable price-point than what was on the market. We got an excellent response, so we made the smallest order possible, of only three shades, and starting selling them at our Brows by G studio locations as well as giving them to some local makeup influencers. Customers started buying them and giving us great reviews but wishing we had more shades. We confirmed that customers would pay for the pencils so we extended our line to 8 shades and made a big product order.

So how do you test the market?

There are a few ways you can do it, but my favourite way (for both product and service businesses) is to build a simple landing page and send people who I believe are my target customers to that page to take an action. Typically the easiest action to drive is an email signup to be first to have access once the product/service is released. This also allows you to start building an email list.

A landing page is a one-page site that is built to drive a specific action. Chances are you've been on plenty of landing pages. They typically have a clear headline, sign-up form and CTA (call to action) like "Start Now", or "Sign Up".

Here's how the process would work.

1) Create and run a digital ad (FB or Google) targeted at the group(s) you've identified and spoken to. use messaging that will resonate with them. You can get a good sampling for $100-$200 in ad spend.

2) Send them to your landing page that has consistent messaging, clearly articulates your value proposition, and has a strong CTA.

3) Measure the CTR (click-through rate) of your ad (how many people see it vs. click) and the conversion rate of your landing page (how many people land on your page that sign up with their email address).

There are no hard metrics for how many sign ups you need to validate your idea, but if at least 3-5% of the people that see your ad make it to your landing page and sign up you probably have something that will work.


The whole process i've outlined above can take anywhere between one week and 3-6 months depending on how complex your business is and how deeply you need to get to know your target customers. Generally, B2B (business-to-business) products and services take longer to validate than B2C (business-to-consumer). This is because you have to sort through who the user is vs. the buyer in organizations.

The more valuable insight and feedback you have to work with the better but you can only do so much. There comes a point when you need to trust in the research you’ve done and make a decision whether it’s worth investing in your idea or not.

It may seem like a lot of work when you just want to get your business going, but I promise you that taking the time to properly validate your idea will save you a lot of time, money, and headache.

About the Author

Scott Russell is a Co-Founder of Simple Growth and has founded four companies ranging from health and beauty to energy and tech. He has led market entry, business development and multi-million dollar growth in over 20 countries around the world including Africa, Europe, and the Middle East.