What lean validation is, how it works in practice and how you can use it to de-risk the venture building process at every stage.
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New business concepts will always have unpredictable elements, and without evidence-based foresight, taking that next step can feel like a shot in the dark - that’s where lean validation comes in.
Whether it’s B2B, B2C or D2C, validation is critical for building any new business. It provides reliable proof that customers want your concept, that you can build it, and that it’s profitable - all before you make heavy investments in time, money or resources.
At Bundl, we validate our ventures using lean experimentation techniques that enable us to:
Let’s take a closer look at what this methodology entails, the different steps in the process and how it differs from venture to venture.
Lean validation is a highly efficient way to get your venture related questions answered. Its main goal is to decrease your blindspots and enable you to move forward based on concrete evidence, providing reliable foresight and significantly reducing any risk.
In essence, it’s a powerful technique that enables you to test your concept with real potential customers and get the feedback you need to:
All before making any serious investments in time, funding or resources. Think of it as a three-step process in which you’ll design the experiment, test your assumptions and gather your insights. Depending on the outcome, you’ll know whether to make adjustments, move forward or cut your losses and move on to the next project.
Corporations don’t build startups the way founders do. They make big moves, which is part of their advantage. They have the resources to make big investments early on, and they want to make sure that their resources don’t go to waste on ideas with no commercial appeal.
From a corporate perspective, validation is essential not only because it reduces the risk of startup failure but also because it enables you to preserve speed.
When executed skillfully, validation can provide reliable proof that your new concept is:
Having these answers beforehand can potentially save you millions. You can kickstart your own validation process with our online validation canvas.
The goal of a validation sprint is to build a series of experiments that will confirm or reject any unknown assumptions about your new product or service. For example, let’s say you have a promising new venture idea, but you need solid data before you can secure the investment you need to get your project up and running.
In this case, a validation sprint is the most efficient way to get reliable proof that your concept is reliable, feasible, viable and responsible. Here are some additional reasons to run a validation sprint:
And best of all, validation sprints can help you get about a month’s worth of work done in just one week. Get the process going with our validation sprint planner.
Building a solid team can be the difference between success and failure in any type of sprint. The key is to make sure you have all the profiles you need to get the job done. In the case of a validation sprint, you’ll need the following profiles:
This profile will be your “validation expert” in the room, helping your team ideate and conceptualise effective experiments to validate key assumptions.
This profile will bridge the gap between the corporation and the startup team, ensuring that the new solution is being prototyped appropriately and following all the corporate and legal requirements.
Your designer will create landing pages, quick brand assets, pitch decks and eye-catching visuals for your new product or service.
Pro tip: It’s always a good idea for at least one of your team members to have been involved in the original concept Design or Ideation Sprint (preferably your designer). It’ll save you loads of time and explaining later on.
There are five key stages involved in running a validation sprint, and they can be spread over five days:
This involves pinpointing the assumptions you want to test, e.g.:
Once you know your assumptions, you can move on to the next step, which is mapping them out on a canvas. This will clear up which assumptions are the riskiest and should be tested first.
Your goal during this step will be to find creative ways to test and validate (or reject) the assumptions you mapped out during step one. You’ll be designing actual experiments to get the answers you need through various types of market research (e.g. face-to-face interviews, online surveys, smoke testing, etc.).
Ask yourself: What’s the most agile, efficient and low-cost way to reliably prove my assumptions?
Now that your experiments have been designed, it’s time to start building! There are quite a few online tools you can use to help set up your experiments and automate your data gathering process. Here’s a list of our favourites:
Now that your experiments are set up, it’s time to go live and start monitoring your data as it comes in.
What happens during this phase largely depends on the type of experiments you and your team designed earlier. For example, suppose you were able to schedule some face-to-face or telephone interviews beforehand. In that case, some of your time will go into gathering data directly from your target audience.
The rest of your time will go into generating traffic for your landing page through ad creation and online marketing campaigns. Some useful resources include Google Adwords, social media ads and Mailchimp for drip campaigns.
It’s time to reap the fruits of your labour! However, keep in mind that, depending on the scope and depth of your experiments, it can take up to 3 weeks before you’re able to gather any conclusive data. Here are some of the key questions you should tackle during this phase:
Start by turning your assumptions into different hypotheses, and then choose the best-suited experiments to provide the answers you’re looking for. A good way to begin is by defining what success would look like for each of your assumptions (e.g. What outcome would give you the confidence to move forward?). Then set up an experiment to measure how close you are to the desired outcome.
Here are some key decision factors you should keep in mind when choosing your experiments:
If you’re operating on a tight schedule or a limited budget, the experiments you choose should reflect that. For example, it’s easier to validate concepts when you have the right channels or a set target audience. If you’re missing the resources for large scale testing, quick and dirty is the way to go.
Smoke testing is a technique that enables you to gather real-world, market demand data on your product or service idea as if it was ready for launch (even if that’s not yet the case).
It involves creating a website for your product or service, complete with images, product specs, and, most importantly, a buy button. Consumer tracking tools will also play a key role, providing valuable data on customer behaviour and preferences.
The goal of a smoke test is to find out how many people will end up clicking the “buy” button, showing proof of their actual intent to buy your offering. In the end, you’ll have the answer to a very important question: Is this concept commercially viable?
Here’s a brief outline of the steps involved:
A unique selling proposition or USP goes further than coming up with a great product or service idea. It refers to the exclusive added value your customer gets when buying your product.
Having a strong USP usually means you’ve already:
Smoke Test websites are built as a “prop” to help gather intelligence on buyer intent. You’re basically creating a space where you can track and study the behaviour of your potential clients.
There are plenty of drag-and-drop website builders that provide beautiful templates. Any of these platforms will do quite nicely:
Once your website is ready, it’s time to start gathering some sweet data. Here are two essential metrics you’ll need to focus on:
One of the easiest tools you can use for tracking is VWO insights. Additional tools like VWO’s “heat maps” or Hotjar can be useful to help you track client behaviour inside your website.
Knowing your audience will take you a long way in terms of creating effective ads that will generate traffic. Here are some useful pointers to get you started:
Useful tools during this stage include:
Paid channels like Google and Facebook ads are great because they’re easy to set up and allow you to work with your own budget.
For more handy tips on how to run your own smoke test, check out our video smoke test tutorial.
The process for validating a venture changes depending on the model you’ll be using (e.g. B2B, B2C, D2C). For example:
You can validate your D2C venture in as little as six to eight weeks following the right steps. Here’s a quick outline:
During this step, you’ll be researching things like new market trends, strategic business insights and target audience personas. Knowing what’s going on in the market and the needs and preferences of your potential customers will help you formulate solid assumptions to be tested later in the process.
Here are some of the key questions you should tackle before moving on to the next step:
During this step, you’ll be turning your ideas into detailed concept mockups, complete with pricing structures and messaging, ready to be validated with potential customers. By the end, you should have a complete assumptions map to help set up your experiments in the next step.
Here are some of the key questions you should tackle before moving on:
During this step, you’ll be creating tangible experiments to validate your D2C venture. Here are some of the key questions you should tackle before moving on to the next step:
During this step, you’ll be gathering customer feedback on things like:
Based on the insights gathered, you can update your value proposition, business case and go-to-market pitch.
The goal during this step is to evaluate the results of the validation, set up the next steps of the venture idea, and craft a compelling pitch narrative, concluding in a detailed “ask” for your funding and resources.
Here are some of the key questions you should tackle before moving on:
By the end of your six-week track, you’ll have gathered enough information to know what your next step should be:
Validating a B2B venture can be a tricky and time-consuming process, requiring a more hands-on and qualitative approach than their B2C counterparts. That’s because, in most cases, your buyer isn’t your end-user. So, instead of getting feedback from a sea of potential customers, you’ll probably be able to count them on your fingers.
This changes some of your basic validation variables, making most canvases and techniques (e.g. Lean UX) unsuited without some tweaks and alterations. Having a smaller group of potential customers:
The good news is that once you know the nuances that make validating a B2C and a B2B venture different, you’ll be better equipped to get answers to questions like:
Check out our article on B2B venture validation for more details on how the process changes.
Finding the customers you need to validate B2C or D2C ventures isn’t always easy, but it’s cake compared to accessing B2B customers. For one thing, there just aren’t as many B2B customers in comparison to B2C. They’re also harder to access for a variety of reasons:
To help you overcome some of these barriers, we’ve compiled a list of five tried and true tips you can use to find and recruit B2B customers to validate your venture.
Join or create relevant groups on platforms like Facebook, LinkedIn and Slack, where you can interact with your target audience. Webinars are also a great place to start a conversation and connect with otherwise hard to access profiles. Here are a few helpful questions to ask yourself before you start your search:
Once you’ve found some groups to join, pay attention to the conversations, share your input on the subject and don’t be afraid to hit up interesting profiles for some feedback.
The LinkedIn Sales Navigator is a great tool for finding B2B profiles. Think of it as a huge B2B database that enables you to do targeted searches based on things like:
Although the service isn’t free, in many cases, it can be worth the money, especially if you do a lot of this type of validation.
With an ever-growing number of people using video content to keep themselves entertained, informed and up-to-date on various topics, YouTube ads are a great way to expand your reach. The trick is to narrow your audience down to a specific target audience that might find your offering compelling. Here are a few tips to get you started:
Sites that provide user-generated content like Reddit and Quora can be a gold mine for finding niche audiences and early adopters.
Once you start a discussion, you’re bound to come across some of the profiles you need to validate your B2B offering.
Cold email prospecting has been done to death in almost every industry, and most of them end up either getting deleted or in a spam folder. A great way to get past that hurdle is to add a bit of warmth and familiarity to the process. For example, you can start by getting on your B2B customer’s radar with:
A little research also goes a long way in providing some common ground for conversation and discussion (e.g. published works, awards received, a recent promotion, etc.). Referring to these events in your email can also help break the ice (e.g. Congrats on your new promotion!) and increase your chances of engagement.
Your validation results won’t always pan out the way you expect them to, and sometimes you’ll have to iterate at various points in the process before reaching any meaningful results. It’s a trial and error technique that takes practice, creativity and a whole lot of patience.
It can be tempting to keep iterating and re-examining waning results but don’t fall into that trap. Stay unbiased, clear-headed and let the data guide your decision-making process. Depending on your results, you’ll either:
No matter how it turns out, you will have met your goal: To know if people will buy your product before investing time and resources into actually building it. In other words: you can’t really lose.
Lean validation can help you achieve a better product/market fit, reduce risk and unlock the funding you need to take your venture to new heights. We can help you validate your venture with real customers in as little as eight weeks.
Data-led branding leverages the power of customer feedback and lean validation to fuel brand creation. We’ve broken it all down into this step-by-step guide.
On this episode of Intrapreneur Stories, we sit together with Seppe Van Sever, intrapreneur at EDF Luminus.