According to legends, Archimedes was in a bathtub when he had his “eureka!” moment, and Newton was inspired by an apple that didn’t fall far from the tree. Wherever and whenever inspiration strikes, the question that comes to mind is almost always: “Is this a great idea?”
Often, entrepreneurs come to me seeking validation. They tell me they’ve got a great idea. And my first question back to them is: “How do you know?” My second question back to them is designed to help them focus on whether they have a great idea or not: “What’s your litmus test?” I want to help them quickly focus and think through how they are measuring the “greatness” of their ideas.
I have plenty of thoughts on how target customers can help validate an idea. Future blog posts will cover that in depth. For now, let's focus on deciding whether to nurture an idea, pivot it, or to let it go.
Start by building a great idea litmus test that allows you to critically assess ideas against your own standards. What criteria go into judging something as a “great idea”? Things you may consider including in your litmus test:
- Addresses an urgent unmet need
- Has a large potential market
- Provides extremely compelling functionality or benefits
- Saves significant time
- Saves or makes significant money
- Disrupts an existing market
- Leverages a unique customer / user acquisition strategy
- Utilizes a unique distribution strategy
- Saves lives (often used when looking at healthcare ideas)
- Is something that investors will back
There is no right or wrong answer. Your litmus test should reflect what is most important to you and your team. As you test your idea against your great idea litmus test, the more attributes your idea has, the stronger it is.
Take Airbnb, for example. Two of the co-founders offered up space on air mattresses in their apartment to bring in extra cash to cover their rent. After their first guests left, they realized they had a “great idea”: a way for people to make money off an under-used asset - their spare room. Of course, those of you familiar with the Airbnb story know that it took a lot more than just a “great idea” to be successful. (You can learn more about their story here.) Far too often I see entrepreneurs place too much emphasis on having a “great idea” with too little focus on execution.
One last important question every entrepreneur should add to his or her litmus test is: “Am I passionate enough about this idea to do what it takes for it to succeed?” As David Bookspan of DreamIt Ventures likes to say, “a startup is a marathon, not a sprint.” So be ready to run with your great idea for a very long distance before it starts to take off.
In later posts I’ll talk about how your answers to your great idea litmus test criteria are usually just broad assumptions that need to be de-risked as quickly and cheaply as possible.