There have been a number of emails recently on the topic of the value of ideas.
Apart from poor execution the next biggest thing that will challenge a startup is the quality of the initial idea[1] (e.g. a business plan with a viable market). Pick the wrong plan and you're having to "pivot" which is a fancy word for saying, "I didn't do my homework well enough and am going to try something else with this mess of code that I have". This post is about how to do your homework and not have to rely on pivoting. I recently met a very interesting entrepreneur, Zilo, who decided to tackle this problem head on. By way of background, he had previously founded 4 companies. 2 of them were successful and he has returned significant value to his investors. 2 of them had failed though. He was onto his next startup. He was confident with his ability to execute but lacked a good idea and was not satisfied with his previous processes for developing a good idea. He researched extensively, tried a few and eventually settled on a process called outcome driven innovation (ODI). So Zilo went to investors and said, "my partner and I are experienced entrepreneurs who have returned millions to our investors. I have a process which I believe will generate several very high quality ideas, but will take 4 months to execute". He got the funding, with no business idea, except a solid plan to get one! It's like the Seinfeld startup story, the startup with no idea. ODI is actually a proprietary process developed by a company called Strategyn and typically employed for large corporates to develop new innovative product lines. But it can be used by entrepreneurs too for the same purpose if you're willing to put in the time to follow the process. Over 4 months Zilo and his partner used a rigorous market needs analysis with qualitative and quantitative surveys to assess literally 1,000's of different "problems" in several problem domains (domains that he was remotely interested in). Generally speaking ODI is a systematic process for finding and assessing user tasks where there is a large gap between the "crititcality of the task" and the "satisfaction of current solutions to the task". For instance, in the travel domain it is critical for me to get to the airport on time(10), and my satisfaction currently is low (3), which represents a major opportunity (7) regardless of the difficulty of improving the task. Surprisingly, of the over many tasks they assessed very few of them had a gap larger than 3. For many of the ideas it was clear that many startups were attacking problems which were not very critical and were pretty well served anyway. For instance, grocery list apps... not a very critical task, and current solutions (e.g. paper) are quite adequate, not an adequate market. ODI is a structured framework for flushing out these tasks (they call them jobs) and doing quant/qual surveys with real consumers to determine whether there is an opportunity. Coincidentally, the business idea that Zilo has picked as a result of this process is phenomenal. He is attacking "clothing fit challenges" for users purchasing online, because it had the biggest gap between criticality and satisfaction of current solutions. Not surprisingly for a creative guy like him, his fit prediction solution is equally amazing as it reduces retailers costs and doesn't require a user to get out a tape measure. I think it will be a big company. Even if it isn't, he has another 4 quality ideas generated from his research. If you want to learn more about ODI read this: http://www.amazon.com/What-Customers-Want-Outcome-Driven-Breakthrough/dp/0071408673 Not suprisingly, once Zilo had found this great idea, he didn't concern himself with sharing it with others... because like all of us he is confident in his ability to out-execute the others. There is really very little literature in the entrepreneurial space devoted to finding good ideas. We hear a lot about passion and commitment. We don't hear a lot about the passion and commitment of the 99% of startups that fail because they had a product looking for a market. Don't assume that you are representative of your market. Whether you use ODI or do not, do some market research before you commit to your idea. Even if you've picked your idea, ODI could help you assess the quality of it. Patrick. [1] http://www.squidoo.com/starup_failures -- You received this message because you are subscribed to the Silicon Beach Australia mailing list. Vist http://siliconbeachaustralia.org for more Forum rules 1) No lurkers! It is expected that you introduce yourself. 2) No jobs postings. You can use http://siliconbeachaustralia.org/jobs To post to this group, send email to [email protected] To unsubscribe from this group, send email to [email protected] For more options, visit this group at http://groups.google.com/group/silicon-beach-australia?hl=en?hl=en
