Creating your own start-up is no easy feat. Many people dream of becoming their own employer or revolutionising the world with their ideas. Competition is fierce and it should come to no surprise that most business ideas end up failing – often as early as within their first year.

There are many reasons as to why a young business might fail, but in many cases the root cause is a lack of proper market research.

In your mind, your idea might sound great but not every idea can be turned into profit. If you want to build a successful business, you will first have to sit down and ask yourself whether your idea is worth executing in the first place.

But how do you tell the difference between a good and a bad idea?

In this post, we will take a look at idea validation and show you how to determine whether your idea has a chance to succeed. 

What is Idea Validation?

Idea validation is the process of testing business ideas to determine their viability. If done correctly, it will help you to make informed decisions and assist you in evaluating whether your business will have a sustainable, growing, and paying audience. 

The process of idea validation can take many forms, but in any case it will extend your market knowledge and keep you from investing into unprofitable business ventures.

Why Should You Use Idea Validation?

The purpose of idea validation is to determine whether your idea has real demand in a given market. 

If you validate your idea before investing into it, you can avoid building and launching a product no one wants or isn’t willing to pay for. This way, idea validation will help you to reduce the risk of wasting your time and resources on a product without real-world value.

What Should Be Validated?

There are various ways to validate an idea. The best way to do so will largely depend on the nature of your particular idea. While idea validation can be an immensely helpful tool, it might not always be necessary. Its usefulness depends on what kind of information is already available to you.

However, it is highly recommended to always validate new business ideas, products, and concepts.

Ultimately, idea validation is about testing assumptions. It is important to start testing your riskiest assumption first so that you can quickly determine whether your idea has the potential to succeed.

How Do You Validate an Idea?

While there are many ways to validate your idea, the overall process is relatively simple and straightforward. We split up the process into four separate steps.

  • Define Goals
  • Develop a Hypothesis
  • Experiment
  • Validate

In the early stages of a business, it is important to focus on validating your most critical and riskiest assumptions first. For example, you might want to validate that there is a certain demand on the market for the type of product or service you want to provide through your business.

Once you have validated your assumptions regarding your market and customers, you can start to test your product more concretely. 

Define your Goal

The process of idea validation starts with defining your goals. Before you begin, you need to decide on what you want to learn and which aspects of your idea you want to validate.

For example, you can start by defining a problem. Once you did this, ask yourself whether your idea adequately solves the problem and how exactly it would do so.

Next, you want to define a customer. Especially at the beginning, the scope of your business will be very limited. Therefore, it is important to define your target audience as precisely as possible.

Another thing to consider is your business model. This also includes the future pricing of the product or service you aim to provide. You want to make sure that your business is profitable and scalable.

While all of these points are important and should definitely be considered before you start investing in your new idea, they are only examples. You can apply idea validation to many aspects of your idea or business.

Try to identify the most critical assumption concerning your idea. This could either be the assumption that is most likely to happen. It could also be the assumption with the worst expected outcome; one that is pivotal to your entire idea. Try to map out all the assumptions regarding your idea and prioritise those that are most critical for the success of your idea.

Develop a Hypothesis

After you define the goal for your idea validation, you need to develop a hypothesis based on that goal. A hypothesis is a short testable statement that often includes a prediction. 

When developing an idea, you inevitably make assumptions about your idea, the problem it means to solve, and the people who you think could benefit from it. Use these assumptions to create testable hypotheses, and start by presuming them to be correct. Your goal should then be to try and disprove, rather than validate, them. If you are unable to refute your hypothesis, you can assume it to be correct.

Creating a good hypothesis is crucial, but it requires a lot of expertise and experience. Because of this, don’t be afraid to ask a professional for their input.

As an example, you could set up a hypothesis based on this template:

I believe that [your business idea, product, concept]

Will help [your target audience]

To [solve the problem you defined]

Which Experiments Can You Use for Idea Validation?

Once you set up a hypothesis, it’s time to start validating your assumptions by experimenting on them. Your experiments are tests that measure the effects of your hypotheses. They are conducted to examine whether your assumptions are correct and will reveal whether it would be reasonable to proceed with your idea.

Don’t be discouraged when your first assumptions are proven wrong. It is perfectly normal for an initial idea to run through multiple different iterations. Use this opportunity to refine and improve your idea.

There are a plethora of experiments you can utilise to test out your assumptions. However, deciding which type of experiment best suits your goals is necessary. Conducting interviews might be enough if you are trying to validate a problem. On the other hand, if you are working on a product, you might want to try and build a prototype for demonstration purposes.

What Some of these experiments include, but aren’t limited to:

Internet Research – An easy place to start with that is often overlooked. Just a few simple queries can help you to assess your market. This is also a helpful tool for defining and researching possible competitors. Consider checking forums and engaging with both professionals as well as existing users within your field.

Create a Website – This can range from creating a simple landing page to writing and maintaining a blog. If you do this, try to engage with the visitors of your website. By offering the option to subscribe to newsletters or even pre-order your product you will be better able to judge user interest in your idea.

Start an ad campaign – You can reach out to your audience by running different ad campaigns. When doing this, try to run split campaigns that each focus on a different aspect of your product or service. This way, you will be able to see which aspects of your idea resonate with your audience and which aspects still need improvement.

Develop a Minimum Viable Product – There are a few different ways to create a Minimum Viable Product. In essence, you create an unfinished prototype to gauge interest in your idea before you start investing in the actual development of the final product.

In any case, try to always ask for feedback from your audience. Their ideas, responses, and comments are invaluable and will give you a better understanding of how to best tailor your idea to their needs.

Validate and Repeat

In this stage, try to confirm the validity of your assumptions. You do not have to get them all right the first time around. As long as your most critical assumption turns out to be correct, you can continue and try to refine your idea.

Continue to validate and iterate your idea using the data you have collected. While idea validation itself is no guarantee for success, it will give you a good idea on what to expect when you eventually decide to make your idea into reality.


Idea validation is an immensely useful tool, meant to help you to reduce the risk of implementing new ideas. It can not eliminate every problem you might face on the way, but it will help you to be better prepared for when they arise.

The most difficult part of idea validation is the creation of assumptions and meaningful hypotheses. Often your theoretical assumptions will differ from the challenges in the real world. As there are many areas of an idea that you can validate, it is of utmost importance for you to understand and identify the most significant assumptions concerning your idea.

If done correctly, idea validation will help you to refine and improve your idea. The knowledge you gained throughout the process will be incredibly useful to make your idea a success.

About the author

EWOR is a school conceived by Europe’s top professors, entrepreneurs, and industry leaders. We educate and mentor young innovators to launch successful businesses.

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