The headline of this post encapsulates the core idea of the Customer Discovery Matrix. You have an idea but you don’t know if it is valid. That’s not a speculative statement- you really don’t know, no matter what the idea is or who you are. It’s unproven. But you can test its validity and determine if it is worth going after….or not. But first, what do we mean by ‘validity’?
Validity Is Determined By Its Value
We work with a concept called a Value Proposition. This is a simple was of mapping an idea into a format that lends itself to testing through customer discovery. It goes like this:
- There is a Problem
- It is a Problem for a number of People
- They have a pressing need for a Solution
- We think this _____ is a potential solution
- Because it creates this Value for those people
So the proposition is Problem + Market Need + Solution = Value to the market. Without a clear validation of each of these factors your idea is not likely to succeed.
It’s as simple as that.
How can we be so sure? In our personal experience working with this process over the last 18 months, we have worked with over one hundred founders exploring 50-60 business ideas. All had to get out of the building (and their assumptive mindset) and find out if their ideas were valid. They collectively have had over 2500 ‘customer’ conversations. About one third of their ideas were not worth pursuing, about one third were generally on the mark but needed fine-tuning and about one third significantly changed their initial hypothesis (known as a ‘pivot’). Each of these three results (failure, iteration, pivot) is equally valuable because they came before significant resources were spent.
Across the entire program, in virtually every case, discovery led them to one of these results within a much faster timeframe than conventional business planning processes.